Hang Seng Index in Major Revamp to Track 100 Stocks
Hong Kong | 1st March 2021
Hang Seng Index (HSI), the leading Hong Kong index that tracks 52 stocks listed on Hong Kong Exchange, will be increasing the numbers of constituents from the current 52 to 80 by mid-2022, and thereafter to 100 constituent. 5 key changes will be made to the Hang Seng Index (HSI) in the latest revamp, starting from the May 2021 Index Review and effective in the June 2021 Index Rebalancing.
” Hang Seng Index in Major Revamp to Track 100 Stocks “
5 key changes will be made to Hang Seng Index (HSI)
In the official announcement by Hang Seng Indexes Company, the changes to the flagship Hang Seng Index (HSI) will ensure it remains the most representative and important benchmark of the Hong Kong stock market.
5 key changes will be made to Hang Seng Index (HSI):
- Increasing the Number of Constituents to 100
- Selecting the HSI Constituents by 7 Industry
- Listing History Requirement Shortened to 3 Months
- Representation of Hong Kong Companies – 20 to 25 constituents
- Adopting a Weighting Cap of 8% on All HSI Constituents
The changes will be implemented starting from the May 2021 Index Review and effective in the June 2021 Index Rebalancing.
Anita Mo, Chief Executive Officer of Hang Seng Indexes Company:
” The new enhancements to the HSI will further increase its representation and make the Index more balanced and diversified.
Building on HSI’s market history of more than 50 years, these enhancements will ensure that the Index remains the most important benchmark of the Hong Kong stock market and will continue to grow and evolve to keep pace with the market.”
The Consultation Conclusions on Proposed Enhancements to Hang Seng Index:
1) Increasing the Number of Constituents to 100
Hang Seng Indexes Company targets to increase the number of HSI constituents to 80 through the regular index reviews by mid-2022 and, ultimately, to fix the number at 100.
2) Selecting the HSI Constituents by 7 Industry Groups
HSI constituents will be selected from 7 Industry Groups. The target is to achieve a market capitalisation coverage of not less than 50% for each Industry Group, and will be reviewed at least every 2 years.
- Financials
- Information Technology
- Consumer Discretionary, Consumer Staples
- Properties & Construction
- Utilities, Telecommunications
- Healthcare
- Energy, Materials, Industrials, Conglomerates
3) Listing History Requirement Shortened to 3 Months
The listing history requirement will be shortened to 3 months. This will provide flexibility for the timely addition of new listings.
4) Representation of Hong Kong Companies – 20 to 25 constituents
Hang Seng Indexes Company will maintain 20 to 25 constituents that are classified as Hong Kong Companies in the HSI. The number of Hong Kong constituent stocks in the index will be evaluated at least every two years.
5) Adopting a Weighting Cap of 8% on All HSI Constituents
All HSI constituents, including weighted voting rights and/or secondary-listed constituents, will be subject to an aligned weighting cap of 8%. The same cap will be applied to the Hang Seng China Enterprises Index (‘HSCEI’).
Related:
- Hang Seng Index Adds 2 More Components to Index, 50 to 52 Companies
- Hong Kong Exchange to Launch New Hang Seng TECH Index Futures & Options
- Hang Seng Launches New Index to Track 30 Largest Hong Kong Listed Tech Companies
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About Hang Seng Indexes Company
Hang Seng Indexes Company Limited (‘Hang Seng Indexes Company’) manages and compiles the Hang Seng Family of Indexes, which cover stocks listed in Hong Kong and Mainland China. Our index series includes the Hang Seng Index, the Hang Seng China Enterprises Index and the Hang Seng TECH Index, as well as Stock Connect, Greater Bay Area and sector-related indexes.
As at the end of 2020, assets under management in products passively tracking indexes in the Hang Seng Family of Indexes had reached a total of about US$38 billion. Hang Seng Indexes Company is a wholly owned subsidiary of Hang Seng Bank.
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