London International Vintners Exchange - an exchange for investment-grade wine based in London

Liv-ex indices
 

Liv-ex publishes two indices, based on the prices of 100 and 500 wines, respectively. The prices that are used to compute the index are wines in bond in London, priced in Pound sterling. Both indices are hugely dominated by red Bordeaux wine. In their construction these indices are similar to a stock market index. The composition of the index is regularly updated as wines are added and removed from the index, and their index weight revised.

Liv-ex 100 Fine Wine Index

The Liv-ex 100 Fine Wine Index is the most widely used Liv-ex price index. As of November 2008, the index was composed to 94.62% of red Bordeaux, to 2.96% of Champagne (vintage préstige Champagne in the form of Cristal, Krug and Dom Pérignon), to 1.02% of red Burgundy wine (three vintages of mixed Domaine de la Romanée-Conti wines), to 0.85% of white Bordeaux (two vintages of Château d'Yquem) and to 0.55% of red Italian wine (two vintages of Ornellaia). The 88 red Bordeaux wines in the index represented vintages from 1983 to 2005, 12 wines from the 1980s, 32 from the 1990s, and 44 from the 2000s. 39 of these wines were different vintages of the five First Growth reds of the Bordeaux Wine Official Classification of 1855.

Futures contracts based on the Liv-ex 100 Fine Wine Index are traded on Intrade and ODL Markets.

Liv-ex 500 Fine Wine Index

The Liv-ex 500 Fine Wine Index includes 500 wines, is less used than the 100-wine index, and is slightly less dominated by Bordeaux.

Barclays Capital Aggregate Bond Index

Index characteristics

The Barclays Capital Aggregate Bond Index is a market capitalization-weighted index, meaning the securities in the index are weighted according to the market size of each bond type. Most U.S. traded investment grade bonds are represented. Municipal bonds, and Treasury Inflation-Protected Securities are excluded, due to tax treatment issues. The index includes Treasury securities, Government agency bonds, Mortgage-backed bonds, Corporate bonds, and a small amount of foreign bonds traded in U.S.

The Barclays Capital Aggregate Bond Index is an intermediate term index. The average maturity as of December 31, 2009 was 4.57 years.

Investing

Many index funds and exchange-traded funds attempt to replicate (before fees and expenses) the performance of the Lehman Aggregate. Some examples of such funds include iShares Lehman Aggregate Bond (AGG), Thrift Savings Plan Fixed Income Index fund, Vanguard Total Bond Market Index Fund (VBMFX), and Fidelity U.S. Bond Index Fund (FBIDX). Fund managers sometimes subdivide the different parts of the Aggregate by maturity or sector for managing individual portfolios. The Municipal section of the index is the only part of the index that cannot be used for this purpose - because municipal debt is issued by so many different entities, the Municipals in the Aggregate are only intended to be representative, and Lehman maintains separate indices for maintaining Municipal-only portfolios.

Reference : Richard A. Ferri, All About Asset Allocation, McGraw-Hill, 2006, ISBN 0-07-142958-1

Source : Google, Wikipedia