NZX 50 Index - Forthcoming potential Changes.

[Shareguy]

•   INDEX – S&P/NZX50 Rebalance - Following a discussion with S&P, our interpretation of the methodology has changed, resulting in a change to our expectations for the upcoming September rebalance (see latest index rankings below). Looking historically, GTK failed the liquidity test at the March rebalance and therefore will not be eligible for entry to the NZ50 until the December rebalance. With only 7 trading days left, we currently expect no changes in the September rebalance. There are 5 stocks with a larger market cap than SML that are failing liquidity. Consequently this means that SML is ranked 55th within the eligible universe of companies, and therefore is within the safe zone, avoiding removal. Looking ahead to the December rebalance, there are 70 trading days to forecast so it is far too early to make any claims, but extrapolating out todays prices would result in PEB and SML being removed, and GTK going in. TRA just beats BGP to also go in, however there is only 0.25% between them.

[Cod]

Geneva, August 10, 2023 Rebalances which will take place as of the close of August 31, 2023.

MSCI GLOBAL SMALL CAP INDEXES - GENESIS ENERGY - Deletion
MSCI GLOBAL MICRO CAP INDEXES - TOURISM HOLDINGS - NEW ZEALAND RURAL LAND - Additions

[bulltrap]

Geneva, August 10, 2023 Rebalances which will take place as of the close of August 31, 2023.

...
MSCI GLOBAL MICRO CAP INDEXES - TOURISM HOLDINGS - NEW ZEALAND RURAL LAND - Additions

No action for NZL and THL at close. I suppose no funds track the MSCI Micro Cap indexes.

[Basil]

S&P confirms no change to NZX50 in Sept quarter rebalance.
Speculatively, as there's a fair bit of water to go under the bridge between before the December rebalance but I think it's looking likely SML and PEB will exit, GTK to go in and TRA.  WHS also a possibility to exit.  Time will tell.
My opinion is its only worth buying more of a share on possible index changes if you really like the company already. 

[winner (n)]

Still chatter about impending Mondiale VGL IPO .......dual listing ASX and NZX with automatic inclusion into NZX50

If that happened would upset a few guess as to who comes and goes

[bulltrap]

S&P confirms no change to NZX50 in Sept quarter rebalance.

Found the announcement here.

There are some changes to MidCap/All/SmallCap due to addition of dual-listed shares previously ineligible. Of note, ANZ, WBC and VSL are being added to MidCap. SmartShares NZ Mid Cap ETF has $150M tracking that index, so there may be some early Xmas shopping happening on Friday 15th.

Speculatively, as there's a fair bit of water to go under the bridge between before the December rebalance but I think it's looking likely SML and PEB will exit, GTK to go in and TRA.  WHS also a possibility to exit.  Time will tell.
My opinion is its only worth buying more of a share on possible index changes if you really like the company already. 

I'm with you on that, watching this thread put TRA on my radar (now holding), but I'd happily buy it anyway for the div yield and low P/E, let alone the earnings growth. I can't bring myself to touch GTK even if it's a shoo-in to the NZX50 - no profit, no tradable volatility, trading at 3x revenue, just isn't my beverage. NPH too dull to mention.

[Shareguy]

S&P DJI has confirmed no constituent changes will be made to the S&P/NZX benchmark indices at the September 2023 quarterly index review. There are a number of minor changes to index shares with changes effective close of market, Friday, 15 September 2023.

Looking towards the next review
Our Forsyth Barr inclusion/exclusion model suggests there could be a number of potential changes at the next quarterly review, that being Dec 2023. Rolling forward current pricing and assuming current liquidity calculations hold, our model suggests that both Pacific Edge (PEB) and Synlait Milk (SML) will drop below the exclusion ranking for the S&P/NZX 50 Index and will, therefore, be removed. The model indicates that Gentrack (GTK) and Turners Automotive (TRA) would be the most likely replacements. However, we note that historically, liquidity �������in GTK has been an issue and going forward �������will need to stay elevated for it to remain a likely contender for entry. Should this not be the case, our next pick would be Napier Port Holdings (NPH

[Basil]

Thanks Shareguy,

I really like TRA anyway, regardless of future possible index inclusion, although I agree this looks highly likely for December inclusion.  Any company that can grow eps in this dreadful economy commands respect and especially with their compelling business plan and execution strategy not to forget the highly attractive metrics, so I have backed up the truck on them and am preparing the trailer unit for duty as well.

Have I mentioned before how much I like their brilliant award-winning marketing with Tina 👍

[Cod]

Geneva, November 14, 2023 Rebalances which will take place as of the close of November 30, 2023.

MSCI GLOBAL MICRO CAP INDEXES

MSCI NEW ZEALAND INDEX
Deletions ARVIDA GROUP

MSCI GLOBAL SMALL CAP INDEXES
Deletions SUMMERSET GROUP HOLDINGS, THE A2 MILK COMPANY

[bulltrap]

Expectations confirmed!

S&P/NZX 50 & S&P/NZX 50 Portfolio Index – Effective Prior to the Open on December 18, 2023

Action - Code - Company
Addition - GTK - Gentrack Group Limited
Addition - TRA - Turners Automotive Group Limited
Removal - PEB - Pacific Edge Limited
Removal - SML - Synlait Milk Limited

So much for releasing 'after hours' - all of these are dual-listed and still trading on the ASX. No price action though.

[Basil]

Interesting that TRA and GTK also being added to the mid cap index.

[Basil]

2023 sure has been a fun year for index changes with some very good gains.
The outlook for 2024 looks very quiet to me, especially in the first half.  Doesn't look like a great year to be hitting it out of the park with index changes.

WHS is the only candidate for possible exclusion that I can see, but the share price would have to move a long way south of where it currently sits at $1.60, (this, a fresh multi year low), and stay there for 6 months, (the 6 month averaging process), for an exclusion event to be triggered.

NPH is the most likely candidate to replace it but the prospects of this happening sometime late in 2024 don't look especially high to me unless WHS shares continue to tank downwards towards a $1.  You never know eh, Nick is certainly making a huge impression with his management skills that's for sure.

[Cod]

Geneva, MSCI Small Cap and Micro Cap rebalances which will take place as of the close of February 29, 2024.
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[BlackPeter]

So - they are moving both Oceania as well as Warehouse from small cap to micro cap fund.

Looks like a non-event if the fund takes the shares out of the right pocket and puts them into the left pocket insead. I suppose all the people waiting for huge price moves had their fun already - nothing to see here.

More interesting might be the companies which move new into the microcap fund (i.e. not trickling down from the small cap) like e.g Arvida, Heartlands, Manawa, Skellerup and many more ...

[Basil]

I think it all depends what the depth is of index tracking funds that follow the small cap index v the micro cap index