LBX 25

Inception & Base Parameters

Inception Date: April 1, 2024

Base Currency: USD

Index Base Value (I₀): 1,000 points

Weighting & Rebalance

Weighting Scheme: Equal weight—each of the N = 25 constituents carries a weight of 1/N 

Rebalance Frequency: Quarterly

Eligibility to Enter or Remain in the LBXpro 25 Index

Each quarter, the LBXpro 25 Index is reconstituted based on company activity and valuation. The selection process follows two main steps:

1. Top 20 by Activity (Valuation ≥ $1B). We first generate an Activity Ranking. The top 20 companies in this ranking are eligible for inclusion if their implied valuation is at least $1 billion as of the rebalancing date.

2. Top 5 by Valuation among remaining active companies. To complete the index, we select 5 additional companies from the pool of active but not-yet-included names. These are chosen based on the highest implied valuation, ensuring that companies with strong secondary market value but slightly lower activity still have a path to inclusion.

Index Calculation & Share Allocation

Initial Share Allocation (at t₀):

Per-Stock Dollar Allocation: A₀ = I₀ ÷ N = 1,000 ÷ 25 = $40 per “notional” share basket

Notional Share Count: \ sᵢ₀ = A₀ ÷ Pᵢ₀

where Pᵢ₀ is the Launchbay price of stock i at base date

Index Level at Later Dates (t):

Holding sᵢ₀ constant until next rebalance, mark-to-market: Iₜ = ∑ᵢ₌₁ⁿ ( sᵢ₀ × Pᵢₜ )

Quarterly Rebalance Formulas

At each quarter-end rebalance (tʳ):

Pre-Rebalance Index Level: Iₜʳ₋ = ∑ᵢ₌₁ⁿ ( sᵢₜʳ₋₁ × Pᵢₜʳ₋ )

New Allocation per Constituent: Aₜʳ = Iₜʳ₋ ÷ N

Updated Share Counts: sᵢₜʳ = Aₜʳ ÷ Pᵢₜʳ