Index provider FTSE Group has seen more demand for the after-tax index series that the group has launched in partnership with the Association for Superannuation Funds of Australia (ASFA), the FTSE ASFA Australia Index Series.
The group said it has a strong pipeline of mandates, while it also plans to launch an exchange traded fund (ETF) on the back of these indices later this year.
"We have three mandates in the pipeline on the back of the FTSE ASFA Australia franking credits indices," FTSE Australia director Julie Andrews said.
"One is from a multi-manager, one from a charitable organisation and one from an institutional investor," Andrews said.
The main interest has been for the FTSE ASFA Australia 200 Super Index - Superannuation franking credit index, and Andrews said the first ETF that the group will list on the Australian Securities Exchange would be tracking this index.
"There are many uses of the indices and institutions are ready to use ETFs," she said.
FTSE announced last Friday that industry super fund SunSuper had awarded a $700 million Australian equities mandate to Vinva Investment Management that would be measured against the FTSE ASFA Australia 300 capital gains tax index.
"Investment returns are earned by members after fees and tax. Sunsuper's new low tracking error active mandate with Vinva seeks to achieve a good level of outperformance that is not eroded by excessive tax leakage," Sunsuper chief investment officer David Hartley said last week.
"In such a mandate it is critical to be able to reference an index that incorporates both income and capital gains taxes. The new FTSE ASFA capital gains tax index fits the bill nicely," Hartley said.
