1.6.9 Cash return

Cash return, or dividend or cash yield, measures the cash received in relation to the initial value of the asset. The index-level cash return is calculated as the weighted average using the index weight of each constituent.

where:
denotes the weight of constituent i at time t-1.

 denotes an index-constituent cash payment to the equity investors (including dividends on equity, interest and repayment of shareholder loans) in the period between times t and t-1 expressed in reporting currency.

denotes constituent i's equity value estimates at times t and t-1 respectively, the adjusts the market value of the company based on the Drawdown of Shareholder Loans in the company:

However, for project companies, theis set to 1, this is because the further equity injections are already reflected in the valuations of project companies. Which is not the case for corporate companies or companies that had default events..

In order to show the cash yield trends, 5- and 10-year moving averages of the index income return are computed.

This is an input to the computation of the price and cash returns contribution.