S&P Rolls Out 500 Index Benchmark for Japanese Equities

October 10, 2002 (PLANSPONSOR.com) - From the company that provided investors with the much-watched Standard & Poor's 500 benchmark comes a similar offering for the Japanese market.

Standard & Poor’s (S&P) announced the launch of its S&P Japan 500 index covering about 88% of the Japanese equity market.

The company said the new index builds on the S&P/TOPIX 150 large-cap index, the S&P Japan MidCap 100, and the S&P Japan SmallCap 250.

The company said its new product is designed to serve as an investable index by adjusting shares of constituent companies for free float. The S&P Japan 500 also offers greater flexibility by covering large, mid and small cap segments of the market.

Like its forerunner, the S&P/TOPIX 150, which has f utures and Exchange Traded Funds (ETFs) trading on the T okyo S tock E xchange and in the US the S&P Japan 500 has high liquidity to s upport the development ofindex-linked products, S&P said.

Toyo Keizai, which is partnering with S&P on the new product, has agreed to provide its database services for the maintenance of the S&P Japan 500, along with marketing support of these newly created S&P indices in Japan.

The S&P Japan 500 will bemaintained by the S&P Japan Index Committee that will aim to apply the following guidelines to the index:

  • investability or free float liquidity
  • sector balance
  • profitability or viability
  • low turnover.

Standard & Poor’s defines the universe of eligible companies as any company trading on the Tokyo, Osaka or JASDAQ exchanges, the company announcement said.