JPMorgan announces new fixed-income next generation markets index

By Ashley Montgomery

Kansas City, Kan., Dec. 13 - J.P. Morgan has launched the J.P. Morgan Next Generation Markets index to track dollar-denominated government bonds issued in frontier markets, the company said in a news release. It provides exposure to non-investment-grade, smaller, less liquid emerging market economies.

The new index, known as NexGem, uses a methodology similar to the company's EMBI Global Diversified index and includes the following 18 countries: Belarus, Belize, Dominican Republic, Ecuador, Egypt, El Salvador, Gabon, Georgia, Ghana, Iraq, Ivory Coast, Jamaica, Jordan, Nigeria, Pakistan, Senegal, Sri Lanka and Vietnam.

The new index selects countries from the EMBI Global Diversified index that meet JPMorgan's criteria for Next Generation markets. It is the first index to cover fixed-income Next Generation markets.

"Growing demand for exposure to Next Generation markets is part of the expansion and deepening of the emerging markets debt asset class. The focus on Next Generation markets is expected to continue as investors seek diversification and higher yields. With NexGem we will provide investors with a well-defined and diligently managed benchmark for these markets within the emerging markets framework," Gloria Kim, J.P. Morgan head of global index research, said in the news release.

J.P. Morgan is the investment-banking subsidiary of JPMorgan Chase & Co.

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