The S-Network Strong/Weak Dollar Equity Indexes are designed to take advantage of periodically fluctuating USD strength by focusing respectively on companies with primarily domestic and primarily international revenue sources. There are currently two indexes in the S-Network Strong/Weak Dollar Equity Index family:
The S-Network Strong/Weak Dollar Equity Indexes embody certain key characteristics that distinguish them from other indexes that attempt to take advantage of exchange rates, including the following:
The S-Network US Large-Cap 500 Index (SN500) serves as the universe for both the SNSUSDX and SNWUSDX. Constituents of the Strong/Weak Dollar Equity Indexes must pass all screens required for the fully investable, duplicate-free benchmark index.
The S-Network Strong/Weak Dollar Equity Indexes weight all stocks equally. Sector weights are capped at twice those of the corresponding sectors in the SN500. This methodology avoids momentum bias and domination by mega-cap stocks, while maintaining correlation to the relevant benchmark.
Constituents of the S-Network Strong/Weak Dollar Equity Indexes are selected based on their percentages of revenue drawn from foreign and domestic sources. SNSUSDX selects those companies with the highest percentages of revenue from domestic sources, and SNWUSDX selects those with the highest from foreign sources.
The S-Network Strong/Weak Dollar Equity Indexes depend on a clearly defined rules-based methodology, which is overseen by an impartial Index Committee. No discretion is exercised in compiling the indexes and a pre-defined screening protocol assures a consistent, transparent and arms-length compilation process.