S&P Rings In Its Global 1200 Index

April 01, 1999

Standard & Poor's recently added another index to its collection of regional and country indexes that will make up the S&P Global 1200. The S&P/TOPIX 150 index is the joint creation of S&P and the Toyko Stock Exchange. It joins a family of indexes that so far covers the United States, Canada and Europe. Real time calculation of the index began at the end of July.

The new equity index tracks 150 highly liquid Japanese securities from each of the major sectors of the Tokyo stock market. As the Japanese counterpart to the S&P 500, it represents approximately 70% of the market value of Japan's equity market. The S&P/ TOPIX 150 is designed both as a benchmark and as an underlying index for investment products.

Qualified U.S. institutional investors could place orders for TOPIX options and invidual stock options contracts with the Tokyo Stock Exchange's member securities companies as of August 1.

The S&PGlobal 1200 is expected to be completed by October with the addition of indexes covering the United Kingdom, Latin America and the Asia/Pacific region, William Jordan, director of communications for S&P, said. "The S&P 500 represents some 75% of the US market. The numbers that we have (in our indexes) are the rough equivalents to the S&P 500. It's the whole philosophy of the S&P500 that is being used for all the rest of the indexes," he added. The Asia/Pacific index is expected to be launched September 1. It will include 100 companies from Taiwan, Korea, Singapore, Australia, New Zealand, Hong Kong and Malaysia.

While many global indexes, such as MSCI and Dow Jones Global Indexes, have excluded Malaysia from their indexes because of the restrictions on foreign investment that were instituted in 1998, Jordan said S&P was comfortable with its decision to include Malaysian companies in the Asia/Pacific index.

 

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