1.6.15 Effective number of TICCS
We compute this metric for the following TICCS pillars: business model, industrial (super)class, region/country and corporate structure. For a given TICCS pillar, these numbers give an idea of the concentration of each category. This is a similar computation to 1.5.4 Effective number of constituents except that the Herfindahl-Hirschman Index (HHI) is computed from the weights of each TICCS category as opposed to the weight of a constituent.
For a given TICCS pillar (e.g. business model) the weight of a TICCS category within it (e.g. contracted) is computed as:
where:
is the weight of asset i,
n is the number of constituents in that TICCS category