Some time back, Dow Jones Indexes teamed up with research and asset management firm Transparent Value LLC to create the Dow Jones Transparent Value RBP Indexes.

Now, a filing with the Securities and Exchange Commission is seeking a green light to launch three index mutual funds using Transparent Value’s proprietary “required business performance” methodology.

The filing covers three index mutual funds: the Transparent Value Dow Jones RBP U.S. Large-Cap 100 High-Beta Leading Index Fund; the Transparent Value Dow Jones RBP U.S. Large-Cap 100 Low-Beta Leading Index Fund; and the Transparent Value Dow Jones RBP U.S. Large-Cap 100 Market-Beta Leading Index Fund.

Essentially, Transparent Value’s RBP methodology attempts to establish the revenue levels a company must generate to justify its stock price. From there, it calculates the “RBP probability” of the company achieving that goal.

The indexes underlying the proposed funds are derived from the Dow Jones U.S. Large-Cap Total Stock Market Index, which has approximately 750 components. The RBP methodology is applied to each one, and the stocks are also evaluated for price momentum and “beta,” or the volatility of the stock relative to the market’s volatility, which is set at a score of 1.

The top 50% of stocks in the original universe in terms of RBP probability and momentum are eligible for inclusion in all three of the underlying indexes. The 400 stocks with scores closest to 1.0 are eligible for inclusion in the “Market Beta” fund’s underlying index, while stocks with scores above or below 1.0 are eligible for inclusion in the "High Beta” and “Low Beta” funds’ indexes, respectively. Components are weighted in each of the indexes according to their RBP probabilities.

If it sounds complex, that’s because it is. The underlying indexes are much closer to the multifactored fundamentally weighted indexes of the FTSE/RAFI index family than the cap-weighted S&P 500. The question is whether investors will be turned off by the complex index methodology paired with a passive investment strategy.

The filing did not include fees or expenses associated with the funds.

You can read the filing here.