Institutional Investor Index

AAA

DEFINITION of 'Institutional Investor Index'

A measure of sovereign debt risk that is published biannually in the March and September issues of Institutional Investor magazine. The Institutional Investor Index is an indicator used to identify and measure economic conditions of booms and crises. The Index is constructed by requesting survey responses from between 75 and 100 investment bank research departments (such as loan officers with major multinational banks) who provide evaluations of a particular country or countries. The answers are then weighted in accordance with the particular bank's global exposure and the level of sophistication for that country's analysis systems.

INVESTOPEDIA EXPLAINS 'Institutional Investor Index'

The Institutional Investor Index is a country risk assessment model available to investors. Country risk refers to a collection of risks related to investing in a foreign country, including political risk, exchange rate risk, economic risk, sovereign risk and transfer risk. Country risk is an important consideration for individuals and institutions interested in foreign investments. The Institutional Investor Index is based on responses made my bank officers who provide subjective evaluations of a particular country's credit quality. The scores of the Index range from 0 (zero), implying certain default, to 100 which implies no probability for default.

RELATED TERMS
  1. Credit

    1. A contractual agreement in which a borrower receives something ...
  2. Economic Indicator

    A piece of economic data, usually of macroeconomic scale, that ...
  3. Institutional Investor

    A non-bank person or organization that trades securities in large ...
  4. Country Risk

    A collection of risks associated with investing in a foreign ...
  5. Political Risk

    The risk that an investment's returns could suffer as a result ...
  6. Welfare Capitalism

    Definition of welfare capitalism.
RELATED FAQS
  1. What is the difference between a global fund and an international fund?

    In the English language, "global" and "international" tend to be used interchangeably - hence the confusion in the investing ...
Related Articles
  1. Insurance

    Investing Beyond Your Borders

    Investing abroad poses risks, but can also help you diversify. Discover ways to invest in foreign stocks.
  2. Options & Futures

    Evaluating Country Risk For International Investing

    Investing overseas begins with determining the risk of the country's investment climate.
  3. Economics

    3 Ways You Can Evaluate Country Risk

    Diversifying your portfolio includes looking beyond your borders. Here are a few ways to analyze risk when investing abroad.
  4. Mutual Funds & ETFs

    Evaluating Bond Funds: Keeping It Simple

    Discover some of the key factors for determining a fund's risk-return profile.
  5. Mutual Funds & ETFs

    Finding Fortune In Foreign-Stock ETFs

    Think beyond your borders to reduce the impact of local market downturns.
  6. Retirement

    Risk And Diversification

    Safeguarding your portfolio involves a few simple steps.
  7. Stock Analysis

    What’s The Best Airline Stock In the Industry?

    With many airlines forced to seek bankruptcy protection, Southwest Airlines stands out as having consistently remained profitable throughout its history.
  8. Stock Analysis

    Can Modi Mania Continue?

    Investors are still swooning over India’s new prime minister, Narendra Modi, whose pro-business platform inspired a record voter turnout of 66 percent in May.
  9. Investing

    The Best Way To Approach The Currency Hedge

    Currency is going to continue to be an important factor in investment choices, particularly as the dollar strengthens.
  10. Investing News

    Sun Pharma And Ranbaxy: An Ideal Pharma Marriage?

    The Sun Pharma merger with Ranbaxy will blend the complementary market strengths and areas of expertise of each company and create a powerful pharma force.

You May Also Like

Hot Definitions
  1. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  2. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  3. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  4. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  5. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
  6. Law Of Supply

    A microeconomic law stating that, all other factors being equal, as the price of a good or service increases, the quantity ...
Trading Center