Microfinance Investment Index (MFII)

The Microfinance Investment Indexes (MFII) are calculated by a microfinance specialist in the Center of Competence for Sustainable Finance in the framework of an ongoing research project. The purpose of the index research project is

• to advance the state of research on indexing of microfinance investments
• to increase transparency in the microfinance investment sphere
• to provide aggregate performance information for a broad variety of MIVs that can be used as a benchmark by microfinance researchers and investors

The MFII were initiated by CCSF affiliated researcher Dr. Julia Meyer for her PhD research project, which was completed in 2013; click here to access the full text of the PhD dissertation.

To date, the following indexes are calculated regularly:

• MFII EUR: for Euro investments
• MFII USD: for US Dollar investments

MFII EUR July 2023 (XLSX, 21 KB)

MFII EUR July 2023 (PNG, 461 KB)

MFII USD July 2023 (XLSX, 23 KB)

MFII USD July 2023 (PNG, 512 KB)

2023 Survey Campaign

To date, the indexes are the broadest microfinance investment indexes available, as they:

• comprise funds mainly invested in microfinance through debt instruments
• include data of microfinance investment funds only, not of other types of MIVs
• include funds with a variety of objectives and return targets
• include a large variety of fund sizes, with total fund assets ranging between around USD 900 million and less than USD 4 million
• include private sector and public sector funds (above 80% of funds classified as private, below 20% as public funds)
• include funds open to both individual and institutional investors (above 80% of funds open to both, below 20% open to only institutional investors).

Performance data of microfinance investment vehicles (MIV) incorporated in the MFII are gathered from data providers (Bloomberg) and, in earlier years, a regular brief survey campaign conducted among MIVs. Submission of performance data to the CMF through the survey campaign is done on a voluntary basis. The number of MIVs included varies between years.

MIV's incorporated in the indexes include:

The indexes are calculated using absolute day-to-day total returns (%) provided by funds or Bloomberg on a monthly basis, starting with a base value of 100 in January 2010 and cumulating monthly returns. Funds enter the indexes on equal weights.

MIV Managers interested in featuring their MIV in the index please contact the CCSF at julia.meyer@execed.uzh.ch. MIVs featuring in the index receive a customized benchmark analysis of their performance.

The CMF is currently evaluating different enhancements of the MFII:

• the calculation of an asset-weighted version of the index
• efforts are being made to expand the number of participants
• the inclusion of funds providing quarterly performance data is being evaluated
• the calculation of specific indexes for different types of investment vehicles is under consideration
• research is being conducted to expand the MFII through systematic valuation and inclusion of social factors in the representation of microfinance investment indexes and benchmarks, based on evidence showing the importance of social engagement in determining returns of microfinance institutions (Meyer, 2013)

To find out more on this subject and download the PhD dissertation, click here.

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