Steady growth of India's stock exchanges has paralleled the expansion of India's economy. With this increased influx of investment, a growing number of individual money managers and institutions are participating in the NSE and BSE, bringing new investment styles and strategies. Investors need to evaluate money manager performance with fair benchmarks that resemble their style of investing. However, until now, there have been no appropriate style-based index benchmarks to measure performance in Indian stock markets, leaving investors to rely upon NSE and BSE indices based upon market capitalization rather than using a true benchmark for any given style or strategy.

Boston Analytics has developed its Stock Market Diaries for India to address the need for a diverse set of style-based indices. Boston Analytics Stock Market Diaries enable reliable benchmarking of money manager performance and support well-informed financial decision-making.

Benefits of Stock Market Diaries
Boston Analytics Stock Market Diaries provide distinct benefits to investors and money managers in two key areas:

• Benchmarking utilizes flexible benchmark indices that reflect the style investment process and replicate the behavior of money managers. This enables money managers and investors to measure performance of their unique style against indices with similar style strategies.
• Style diversification, based upon indices of performance differentials under various economic and market conditions, can influence the overall performance of an equity portfolio and explain return variability by categorizing equities with similar characteristics and risk factors.

Stock Market Diaries' Methodology
The companies present in the Boston Analytics Stock Universe are sorted according to the values of fundamental variables in a descending order. The fundamental variables under considerations are market capitalization, price-to-book value, and three-month momentum. Stocks then are grouped into ventiles to form portfolios. For example, the top five percentile companies based on the values of a fundamental variable would form the topmost portfolio, then the next five percentile companies form the next portfolio, and so on. Portfolios are formed on the basis of each fundamental variable.

The portfolios are tracked for an investment period of one year (June 1 to May 31) and are reconstituted for each investment period based on fundamental variables. The portfolio is not rebalanced during the investment period to avoid transaction and operationalization costs.

Monthly Stock Market Diaries
The executive summary of each monthly Stock Market Diaries report is available for download. The full reports are available for purchase as a subscription or individual monthly reports, and customized reports can be produced by Boston Analytics to meet clients' specialized requirements. Contact Boston Analytics to learn more:

• Email IndiaWatch@bostonanalytics.com
• In India, call Shirin Bagga at +91 22 25182092.
• In the U.S., call Ted Thorbjornsen at 617-457-7888 ext. 302.