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This year, the SWX Swiss Exchange is restructuring its SMI and SPI families. The most important change is the stipulation that the SMI must comprise 20 constituent securities and the SMIM 30. The SWX will also introduce a capped equity index that will comprise the 30 largest securities of the Swiss equity market. The largest securities in the index will have a maximum weighting of 9 % or 4.5 %. The review dates will change as well: they will be moved to the trading days following the Eurex expiration dates in March and September. With these changes, the SWX is responding to the needs of the market.
Restructuring of the SPI and SMI families
The SWX Swiss Exchange, in cooperation with the Index Commission, has overhauled the SMI and SPI families. This restructuring is the SWX's way of responding to the changed market environment and the new needs of investors.
The following changes to the existing indices have been decided:- The SMI will comprise a fixed number of 20 securities.
- The SMIM will comprise a fixed number of 30 securities.
- The SMI Expanded (SMI and SMIM) will therefore comprise a fixed number of 50 securities.
- The SPI Large will comprise precisely the 20 securities of the SMI.
- The SPI Mid will comprise the following 80 securities.
With this restructuring, the SWX intends to give the SMI a clearer profile as a basis for traded products for the benefit of issuers and investors. The market-based indices of other index providers also comprise a fixed number of securities (DAX 30, EuroStoxx 50, DJIA 30, S&P 500 etc.). The SMIM and the SPI EXTRA will both show gains thanks to the additions from the SMI. The restructuring of the SMI and SPI families is a reaction to the changed circumstances of recent years. It is not yet clear which companies will be affected by the changes. The ranking as of 30 June 2007 (according to average daily capitalisation and the turnover achieved during one year, i.e. from 1 July 2006 through 30 June 2007) will determine which companies will belong to the SMI and which to the SMIM.
Introduction of a capped equity index for the 30 largest Swiss securities
In July 2007, the SWX Swiss Exchange will introduce a capped equity index for the 30 largest Swiss securities. The four largest securities will be capped at 9 %; the others at 4.5 %. The index offers several benefits: capping improves risk diversification for investors and allows the sale of options and futures at Eurex USA. Because the capped index complies with the regulatory frameworks of Switzerland, the EU and the US, the products traded on it will allow new markets to be tapped, which will generate liquidity for the companies included in the basket.
Changed review dates
The ordinary index-review dates will be brought forward from the first trading day in April and October to the Eurex expiration dates +1 (trading day) in March and September. This change will first apply to the review of September 2007.
