newallords - A N E W A L L O R D I N A R I E S I N D E X I...

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A NEW ALL ORDINARIES ® INDEX IN 2000 meeting the needs of australia’s investment community
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Over time the All Ordinaries Index has emerged as a key tool for the investment community. While the present form of the All Ordinaries meets the needs of some parts of the investment community others want a broader index and others want a narrower index. The challenge to provide an index that serves the purposes of being both a measure of price movement and an investment benchmark has led to the design of a new All Ordinaries Index package. Effective 3 April 2000 the All Ordinaries Index will be extended to 500 companies using market capitalisation only as an eligibility requirement. Its main purpose is to measure the price performance of the market. Six Benchmark Indices will be created using liquidity as the fundamental criterion for determining eligible stocks. ASX is changing the All Ordinaries ® Index to better meet market needs and provide a greater level of choice. 1 All Ordinaries ® is a registered trade mark of ASX Operations Pty Ltd, ACN 004 523 782.
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What it will deliver to the market All Ordinaries Index Many of the listed companies previously ineligible for inclusion in the Index because of limited share market activity will now be considered. With 500 stocks and no liquidity requirements, this index will be ASX’s ‘headline’ index featuring in the media, on ASX electronic wallboards and Skysigns. The All Ordinaries Index will become an umbrella index with 6 ASX Benchmarking Indices beneath it. The All Ordinaries at 500 companies will continue to serve the needs of the community at large. Six ASX Benchmarking Indices These sub-indices have been created to match the varying needs of the investment community and should not influence any single investing style. ASX20 and ASX50 These were previously known as the Top 20 and 50 leaders. Feedback from the investment community revealed these ASX Indices to be useful for targeted investment strategies. ASX100 ® This will provide a benchmark for large active investment managers where the emphasis is on having a portfolio with sufficient liquidity. It will essentially cover large-cap and mid-cap stocks selected by a process of index capitalisation ranking. ASX200 For those investment managers looking to replicate a portfolio where there is sufficient market capitalisation and liquidity to ensure relative ease of purchase or sale. It will comprise the current ASX100 (including applicable downweighting factors) and the next 100 stocks selected by turnover from companies whose index capitalisation exceeds $150 million. ASX300 The ASX300 is designed to be suitable for investment managers with an expertise in smaller stocks who require a benchmark broader than the ASX200 but which contains stocks which are sufficiently liquid for institutional investment. It will include the companies in the ASX200 at the downweighting factors applicable to that Index, as well as
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newallords - A N E W A L L O R D I N A R I E S I N D E X I...

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