With new indices, Asean may spur equity trade

In a bid to boost the visibility of Southeast Asian equity products, the Asean Exchanges—a group of bourses supporting regional integration—has rolled out three new indices broadly covering the growing Asean market.

The three new tradable Asean indices are the FTSE Asean All-Share Index, FTSE Asean Stars Index and FTSE Asean All Share Ex-Developed Index.

In a statement, Asean Exchanges said the new expanded index series would increase the visibility and transparency of Asean and create a wider variety of stocks for all Asean markets.

Constituents of seven bourses in six Southeast Asian countries—Thailand, Malaysia, Singapore, Indonesia, Philippines and Vietnam, which has two bourse—make up the series.

FTSE Asean All-Share index is the broad headline benchmark representing up to 95 percent of investable market capitalization in the region. This represents the performance of large, mid-cap and small-cap Asean companies.

FTSE Asean Stars Index will comprise the 30 “most exciting” companies of each Asean country based on their market capitalization and liquidity.

FTSE Asean All-Share ex-Developed Index represents the performance of all the developing countries in the FTSE Asean All-Share Index except Singapore, which has the most sophisticated market in Southeast Asia.

The group said the indices would be the “building block towards creating broader benchmark indices, meaningful sectors indices and new Asean products that will bring more Asean tradable opportunities for investors and enhance liquidity among the exchanges.”

The members of Asean Exchanges are Bursa Malaysia Berhad, HoChiminh Stock Exchange, Hanoi Stock Exchange, Indonesia Stock Exchange, Stock Exchange of Thailand (SET), Singapore Exchange and Philippine Stock Exchange.

“Asean, one of the fastest growth regions of the world, is an exciting capital market … Investors will have a one-point access to an aggregated and comprehensive Asean content,” said SET president Charamporn Jotikasthira.

Other existing indices are FTSE Asean Sector Indices, calculated at industry, supersector and sector levels using the industry classification benchmark and FTSE/Asean 40 Index, which represents the performance of the largest companies in the Asean markets.

The seven Asean Exchanges have a combined market capitalization of about $2 trillion with more than 3,600 companies listed on their exchanges.