Korea Stock Exchange: Introduction Of Korea Dividend Stock Price Index (KODI)

The Korea Stock Exchange announced that it would publish Korea Dividend Stock Price Index called KODI from 21 July 2003, which was developed jointly with the Research Institute for Securities and Finance, Seoul National University.

The KODI is a market capitalization weighted index of KSE-listed 50 blue chips that have shown strong earning power as indicated by high return on equity (ROE), good liquidity, and large market capitalization. The component stocks are selected based on a set of criteria including payout ratios, dividend yields, and cash dividend payments.

The main purpose of introducing the KODI is to provide the investors with a new appraisal indicator, particularly for those long-term investors who search solid returns from equity investments.

Details on the index are as followings:

• Index name: KODI (Korea Dividend Stock Price Index)
• Calculating method: Market capitalization weighted
  • To prevent the excessive influence on the index by few companies with large market capitalization, the relative weight of market capitalization of individual constituent stock is limited up to 10 percent.
• The number of constituents: 50
• Base date: July 1, 2001
• Base index: 1,000
• Publish date: July 21, 2003
• Periodic review of constituent stocks: July, every year

Please click (http://www.kse.or.kr/upload/madang/1058343575408.xls ) here to view a full list of KODI constituents. The list is also available on the KSE's web site (http://www.kse.or.kr/webeng )

For future reference, the KSE is planning to launch a new ETF, which tracks the performance of the KODI, in September this year.