Dow Jones Credit Suisse LEA Hedge Fund IndexSM
The Dow Jones Credit Suisse LEA Hedge Fund IndexSM* is a composite index comprised of the Dow Jones Credit Suisse LEA Latin America, Emerging Europe, Middle East & Africa and Asia Region Hedge Fund Indexes and weighted according to the individual region weights of the Dow Jones Credit Suisse LEA Region Hedge Fund IndexesSM at each semi-annual rebalancing date.
Definition of Eligible Funds
A hedge fund is eligible for membership in the Dow Jones Credit Suisse LEA Hedge Fund IndexSM if it meets all of the following criteria:
- It is accepting new investments and redemptions and, if an existing member fund within the index, has not been subject to a forced redemption or designated a closed member fund as described under forced redemptions and member funds closing to new investments in the index rules.
- The minimum amount for initial investment is less than or equal to the greater of (i) the product of USD 20,000,000 and its prospective weight in the relevant regional index and (ii) USD 100,000.
- It imposes a minimum amount for subsequent investments, that minimum is less than or equal to the greater of (i) the product of USD 5,000,000 and its prospective weight in the relevant LEA Region Index and (ii) USD 100,000.
- It is not a U.S. domiciled hedge fund.
- It has no investment lock-up period.
- It allows investments no less frequently than monthly.
- It allows redemptions no less frequently than monthly.
- It meets the reporting requirements of the Dow Jones Credit Suisse LEA Hedge Fund IndexSM.
- Neither it, its investment management company or any affiliate are, to the knowledge of the calculation agent, under investigation or review by a regulatory body or other authority for reasons of wrongdoing, breach of any law, regulation or rule, or any similar reason, which is deemed likely to be materially adverse to the fund by the calculation agent.
- It allows investment by investors whose beneficial owners are "restricted persons" for the purposes of U.S. "new issues" as prescribed by Rule 5130 of the Conduct Rules of the Financial Industry Regulatory Authority (the "New Issues Rule") by issuing share classes for restricted persons or because the fund does not otherwise contravene the New Issues Rule 5130.
- It has an AUM of at least USD 50,000,000.
The Dow Jones Credit Suisse LEA Hedge Fund IndexSM is rebalanced semi-annually. Member funds are chosen according to the following procedure:
- The open/close status of each fund is determined.
- Eligible funds are determined as those funds from the investable universe that meet the definition of eligible funds.
- For each Dow Jones Credit Suisse LEA Region Hedge Fund IndexSM, the member funds are determined in order of size by AUM for that region, with funds selected in order from largest to smallest AUM in each regional index. Once an eligible fund is included in a particular regional index, another eligible fund managed by the same or an affiliated investment manager may not be included in the same regional index. The target minimum number of funds is 10 funds, but the actual number may be less than this number. The determination of the member funds is made before applying the fund scaling rules specified in the Dow Jones Credit Suisse LEA Hedge Fund IndexSM rules.
- The weight of each member fund is calculated per their AUM in accordance with the procedure for determining weights specified in "Initial Index Construction" of the Dow Jones Credit Suisse LEA Hedge Fund IndexSM Rules Document, including the procedures for fund scaling, region scaling and intra-region scaling. Weight caps may be applied to enhance diversification and limit concentration risk.
Please see the Dow Jones Credit Suisse LEA Hedge Fund IndexSM Rules Document for additional rules, eligibility definitions and technical specifications.
*formerly known as the Credit Suisse/Tremont LEA Hedge Fund Index since April 1, 2008.