Investment Banking Services Price Index (IBSPI)

Detailed information for 2021

Status:

Active

Frequency:

Annual

Record number:

5239

The Investment Banking Services Price Index (IBSPI) measures annual price changes over time for investment banking services in Canada. The estimates are produced on an annual basis.

Data release - March 18, 2022

Description

The Investment Banking Services Price Index (IBSPI) measures annual price changes over time for investment banking services in Canada. Prices are derived as a weighted average of percentage commissions for new issues of equity and debt on Canadian financial markets. The primary purpose of this measure is to deflate the associated commodity output in the Canadian System of Macroeconomic Accounts (CSMA).

This index is part of the Services Producer Price Index program (SPPI) at Statistics Canada.

The SPPI program develops and produces price indexes for a number of business service categories. This initiative fills an important data gap in the area of economic statistics and has resulted in a more comprehensive set of service price indexes. These indexes allow Statistics Canada to produce more accurate estimates of real-value added (Gross Domestic Product) and changes in productivity.

Reference period: The time period for which the IBSPI equals 100; currently this is the year 2017.

Collection period: Quarterly data are obtained 6 weeks after the end of each reference quarter. Data are published annually.

Subjects

  • Prices and price indexes
  • Professional, scientific and technical services
  • Service price indexes

Data sources and methodology

Target population

The target population for the IBSPI is Canadian investment banks. Investment banks fall under the North American Industry Classification System (NAICS) industry 52311 Investment Banking and Securities Dealing.

Instrument design

This methodology type does not apply to this statistical program.

Sampling

This methodology type does not apply to this statistical program.

Data sources

Data are extracted from administrative files and derived from other Statistics Canada surveys and/or other sources.

The data are obtained from FP Infomart© (2016 Financial Post. All rights reserved) and from Statistics Canada's CODR database.

FP Infomart, a private sector data provider, tabulates the data set so that it conforms to the needs of the program. Microdata records are categorized into products, and product prices are derived as averages of percentage commissions.

The implicit price index for Gross Fixed Capital Formation is produced by the Macroeconomic Accounts Branch (MEAB), and is obtained from CODR (table 36-10-0223-01).

The data sources are combined to derive a price index for investment banking services.

Since the value of money is eroded over time, a deflation factor is applied. The Gross Fixed Capital Formation implicit price index is used as a deflator for proceeds. This allows for a constant unit of measure.

Error detection

Error detection is conducted at the time of data collection and also during post collection processing, using a set of systematized error detection procedures to identify outliers and possible reporting anomalies. Records that fail these edits are reviewed for editing and correction when necessary or edit failure may trigger a follow-up with the respondent.

Time and effort is devoted to keeping the specifications constant such that only the pure changes in price are tracked. Some information are also collected in order to ensure, as much as possible, that the collected data correspond to the same specifications over time. This constant quality price then feeds into the Canadian System of Macroeconomic Accounts' (CSMA) estimates of constant dollar GDP.

Imputation

Missing data are generally estimated by a systematized imputation process. In any given period, price data may not be available for estimation. In such cases, missing data are imputed using the average price movement of remaining units within the same stratum (overall mean or targeted mean imputation method).

Estimation

Prices
For each product category, the price is calculated as an average percentage commission on the proceeds (i.e., total commission income divided by total proceeds adjusted by a deflator).

Weights
The IPSBI uses the commission revenue in Canadian dollars from the product-specific investment banking services, calculated from data provided by FP Infomart as the source of weights. The weights for the basket are updated yearly.

Indexes
Estimates are a weighted average of annual price changes by product, which are chained together to form an index series. The IBSPI is a national index which uses reported underwriting commission revenues of investment banking service activity in our data set as its weighting source. The IBSPI calculates three types of price indexes (Laspeyres, Paasche, and Fisher), and is available at the Canada level only. The Fisher index is an example of a superlative index and is the preferred measure of price change when there are large differences in weights from period to period as is the case with the IBSPI.

Linking of indexes
With the introduction of a new basket, historical estimates are linked to the new basket by maintaining the same historical period-to-period changes. This is done by calculating a link factor for each index series as the ratio of the new index series in the overlap period to the old index series. This link factor is then applied to the old index series to bring it up or down to the level of the new index series.

The overlap period for the IBSPI is currently 2017.

For more information about the concepts, methods or data quality, please refer to the "Technical supplement for the Investment Banking Services Price Index," which is published as part of the publication Prices Analytical Series (62F0014M).

Quality evaluation

An in-depth assessment of quality is conducted prior to the dissemination of estimates. This assessment is based on two key elements of quality (accuracy and coherence); as defined in Statistics Canada's guidelines for the validation of statistical outputs.

The quality of the index depends on price and weight data obtained from an administrative data sources. Using Statistics Canada's Quality Assurance Framework to assess the fitness for use of administrative data, continuous monitoring of the data received and ongoing discussion with the data supplier, the analysts ensure that the targeted industry coverage rates are met every cycle. Analysts pay close attention to this metric and react appropriately to ensure that the coverage of the industry is thorough. Particular attention is also given to ensuring that sampled products or services are representative of actual transactions happening in the market place. These two activities, fundamental to the overall quality of the estimates, are done consistently.

Analysts also undertake additional validation activities every cycle to ensure the coherence of survey estimates. These include: analysis of price changes at the company, industry, subsector and sector levels; certification of key contributors to price change; and confrontation of estimates against other related data sources. Contextual analysis of survey results is also performed in light of prevailing economic conditions.

Engagements with relevant stakeholders are also undertaken periodically. Forums involving other Statistics Canada analysts, industry stakeholders and partners at other national statistical agencies provide valuable insights that inform the development and research agenda of the program.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects which could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various transformations are applied to collected price data in the calculation of price indexes, such that it is not possible to identify the raw price data obtained from any survey participant. Confidentiality rules are also applied to price indexes that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

Revisions and seasonal adjustment

Data for the most recent year are preliminary. The previous year of the series is subject to revision. The index is not seasonally adjusted.

With the release of 2018 data and coinciding with the introduction of the Paasche and Fisher price indexes, data for all previous years has been revised.

Data accuracy

The statistical accuracy of this index depends on price and weight data obtained from administrative data sources. Each type of input data is subject to its own errors. Processing procedures for editing and imputation are in place to ensure the quality of data. Consequently, the aggregate indexes at all levels are considered to be statistically reliable.

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