The Egyptian Exchange (EGX) recently launched a brand new index dedicated to treasury bonds (T-bonds) after its methodology is approved by the EGX’s Index Committee.

The new index is to complement EGX’s efforts for developing its indicators to measure the performance of securities traded, wrote the exchange in a statement.

The new Treasury bond index includes most liquid bonds on the stock market, with the weight of each issuance to be based on the market value (market capitalization) of the bond.

The index takes into account both the return resulting from the change in bond prices, and the return resulting from the accrued coupons, which reflects the total return for the performance of the government bonds that make up the index.

With its launch, it will allow for the introduction of investment products that track these indices and boost the diversification of available investment products.

Additionally, 4 sub-indices for treasury bonds will be launched soon, to be determined based on different maturity periods, to form an index series for government bonds, the EGX added.

These sub-indices will be reviewed monthly to exclude non-qualified bonds and include bonds that meet the criteria for joining the index in order to ensure a good representation of the Egyptian bond market. Treasury bond indices were calculated starting from 3 January 2021 at a value of 1,000 points.