- Enhancements to Malaysia's equity benchmark index to better reflect the growth and diversification of the Malaysian equity market.
- Implementation to take place over two phases from December 2026 to June 2027 following strong support received during public consultation.
Bursa Malaysia Berhad ("Bursa Malaysia") and FTSE Russell today announced enhancements to the methodologies of the FTSE Bursa Malaysia KLCI ("FBMKLCI") and the FTSE Bursa Malaysia Mid 70 ("FBM70") indices, following a public consultation conducted earlier this year. Implementation will take place in phases beginning 21 December 2026, in line with FTSE Russell's index review schedule.
The public consultation, conducted from 31 March 2026 to 24 April 2026, indicated broad support for the proposed enhancements among asset owners, asset managers, brokers and other market participants. Following a comprehensive review of feedback received and subsequent further engagements with key stakeholders, Bursa Malaysia and FTSE Russell have confirmed the following changes.
- FTSE Bursa Malaysia KLCI (FBMKLCI): The FBMKLCI will be expanded from 30 to 50 constituents, increasing its representation of MAIN Market capitalisation from approximately 60% to 70%, based on simulations using June 2026 data.
- FTSE Bursa Malaysia Mid 70 Index (FBM70): Following the expansion of the FBMKLCI, the FBM70 will be reduced from 70 to 50 constituents and renamed to FTSE Bursa Malaysia Mid Cap Index (“FBMMCAP”). The FTSE Bursa Malaysia Top 100 Index (“FBM100”) will remain unchanged at 100 constituents.
Dato’ Fad’l Mohamed, Chief Executive Officer of Bursa Malaysia, said: “Malaysia's equity market has evolved considerably over the years, with growth sectors gaining scale and prominence alongside established sectors. By increasing representation across sectors and companies, the enhanced FBMKLCI will provide a broader reflection of Malaysia's economic landscape while preserving the relevance investors expect from our flagship benchmark. It will also increase the visibility of a wider range of Malaysian companies and ensure the index continues to evolve alongside the market it represents.”
Gerald Toledano, Group Head of Equity and Multi Assets at FTSE Russell, said: “The enhancements to the FBMKLCI represent an important step in ensuring Malaysia's flagship benchmark remains representative, investable and aligned with the needs of domestic and international investors. The strong support received during the consultation process underscores the importance of maintaining benchmarks that keep pace with market developments. We look forward to working closely with Bursa Malaysia and market participants to support a smooth transition and implementation of these changes.”
Based on simulations using data as at end June 2026, the expanded FBMKLCI would include representation from the Technology, Energy, and Real Estate Investment Trusts ("REITs") sectors for the first time, while moderating concentration in the Financial Services sector. Actual constituent and sector composition at implementation will depend on constituent eligibility at the relevant review dates.
The FBMKLCI enhancement will be implemented through a phased approach, a well-established practice that FTSE Russell has applied successfully in major index transitions globally. This approach supports an orderly transition, helping to reduce concentrated trading flows, minimise market impact, and facilitate portfolio rebalancing by market participants.
Accordingly, the implementation will be carried out as follows:
- Phase 1 (effective 21 December 2026): The 20 new constituents will be added to the FBMKLCI at 50% of their final index weight.
- Phase 2 (effective 21 June 2027): The 20 new constituents will reach 100% of their final index weight, completing the transition to the enhanced FBMKLCI.
The number of constituents in the FBM70 will be reduced from 70 to 50 on 21 December 2026 in conjunction with the index review. All constituent changes will take effect on that date.
The expansion of the FBMKLCI marks the first change to its methodology since July 2009, when the benchmark transitioned from a 100-constituent index to its current composition of 30 constituents to optimise index replication and liquidity for institutional investors. The latest enhancements ensure the benchmark continues to evolve with the market.
Please refer to the Frequently Asked Questions (FAQs) available here for further details.
