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Activity filters

All activities or sectors are not attractive to typical PE investors. Therefore, to make our universe representative of investments in private markets, we exclude the below sectors.

  1. Real Estate Companies: Many PE fund mandates prevent private funds from directly investing in real estate, especially companies that identify as pure-play real estate companies. AC09 or Real estate and construction activity consists of two sub-activities, including AC09001, or “Construction of residential and non-residential buildings” and AC09002 or “Real estate activities”. To remove pure-play real estate companies, AC09002 is excluded from the PEU.

  2. Infrastructure Companies: Infrastructure qualifies as a separate private asset class and private infra funds specialise in investing in them. Moreover, traditional PE strategies also do not work that well in infrastructure, and investments are more passively held. Therefore, we exclude the AC12, i.e., the Utility sector from the PEU.

In addition to Real Estate and Infrastructure companies, we also exclude Banks & Insurance Companies, as they are highly regulated, require licenses, have restrictions on concentrated ownership, thereby not accommodating the usual PE strategies for value creation. Nevertheless, typical PE funds are investing increasingly in these activities (Global Treasurer, 2024). Therefore, we allow the Banks and Insurers to be priced and part of PEU and BMU, but exclude them from company selection for flagship indices.

Specifically, AC02001 and AC02002 PECCS™ codes corresponding to sub-activities, “Financial service activities, except insurance and pension funding” and “Insurance, reinsurance, and pension funding, except compulsory social security”, respectively, are excluded from index construction. The remaining sector AC02001 or “Activities auxiliary to financial services and insurance activities” is retained as part of the Financials activity for index inclusion.

The weights computed in the previous section for each activity and country are based on macroeconomic inputs derived in a top-down manner, and these weights include all the above-excluded sectors. Thus, we adjust those weights in the below manner to accommodate these exclusions.

  1. When the whole activity is dropped (e.g., AC12), then the remaining weights are redistributed among all remaining activities in proportion to their original weights.

  2. When some sub-activities are dropped in the sector, it would be unfair to reassign all the remaining weight in this sector to the surviving sub-activity. We do the below for such a situation.

    1. Compute the weight for each sub-activity class according to the sum of the revenue of all BMU companies in the sub-activity.

    2. Take the weights of the excluded sub-activity and redistribute it among all other surviving activities in other sectors and the surviving sub-activities within the same activity.


The Global Treasurer. (2024). Private Equity Reshapes Life Insurance Landscape amid Regulatory Scrutiny. The Global Treasurer, September 20, 2024. https://www.theglobaltreasurer.com/2024/09/20/private-equity-reshapes-life-insurance-landscape-amid-regulatory-scrutiny/.

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