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ESMA_QA_1014

ESMA_QA_1014

Status: ✅ Answer Published

Link to ESMA Q&A tool: https://www.esma.europa.eu/publications-data/questions-answers/1014

Regulatory Context

Regulation : PROSPECTUS

Level 1 Regulation: Prospectus Regulation 2017/1129

Level 2 Regulation: No information available

Level 3 Regulation: No information available

Topic: Content of prospectus

Subject Matter: Derivatives, indices, underlyings and related disclosure - Interpretation of the text “description of the index” included in item 2.2.2 of Annex 17 of the Commission Delegated Regulation (EU) 2019/980

Question

Submission Date: 12 July 2019

ESMA has discussed how the text “description of the index” included in item 2.2.2 (“Where the underlying is an index”) of Annex 17 of the Commission Delegated Regulation (EU) 2019/980 should be interpreted?

ESMA Answer

Answer Date: 12-07-2019

[ESMA31-62-1258 Prospectuses Q&A 12.1] To allow an investor to make an informed assessment, ESMA believes that the description of the index should contain the essential characteristics which will enable full comprehension of the index and its dynamics. Accordingly, ESMA considers that at least a description of the following essential characteristics should be included:

  • strategy of the index/investment policy;
  • description of the individual selection process of the components weighting factors;
  • method and formulas of calculation;
  • name of the calculation agent;
  • adjustment rules;
  • review frequency;
  • type of index (price return, excess return, etc.); and
  • currency The description of the composition of the index should be provided as of the date of the prospectus.

This document was automatically extracted from the ESMA EMIR Q&A database.

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