Defining Property Market Performance
To create a derivative there needs to be a point of reference for the performance of the market against which the derivative contracts are priced.
In the case of property derivatives, this reference is provided by the Investment Property Databank and the FTSE index in the United Kingdom, and NCREIF, S&P/Case-Shiller and Rexx in the United States.
The IPD Index and the FTSE UK Commercial Property Index Series provide a number of indices which relate to performance of commercial property. There are many indices reflecting sectors and sub-sectors of the commercial property market. To date, much of the interest in property derivatives relates to the UK market and its sub-sectors.
Read more about this topic: Property Derivatives
Famous quotes containing the words defining, property, market and/or performance:
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—Mary Barnett Gilson (1877–?)
“If property had simply pleasures, we could stand it; but its duties make it unbearable. In the interest of the rich we must get rid of it.”
—Oscar Wilde (1854–1900)
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—Henry David Thoreau (1817–1862)
“Kind are her answers,
But her performance keeps no day;
Breaks time, as dancers,
From their own music when they stray.”
—Thomas Campion (1567–1620)