One of the changes in the S&P Dow Jones Indices rebalancing is that Afterpay Touch Group Ltd (ASX: APT) is entering the ASX 100.
S&P Dow Jones describes itself as the largest global resource for index based concepts, data and home to key market indicators like the S&P 500 and the Dow Jones Industrial Average. More assets are invested in products based on its indices than any other provider. It now has over 1 million indices across a variety of asset classes.
S&P / ASX 20 Rebalance Changes
The strong performance of the real estate investment trust (REIT) sector has seen Goodman Group (ASX: GMG) grow significantly in valuation, which will lead to its promotion into the ASX 20.
But for a promotion to happen there needs to be a relegation. Coles Group Limited (ASX: COL) is the one being kicked out. I’m sure management are hoping that the proposed job cuts will be one step towards taking its place back.
S&P / ASX 100 Rebalance Changes
The headline news is that after Afterpay capital raising it will be entering the ASX 100. Joining Afterpay in the ASX 100 will be resources business Beach Energy Ltd (ASX: BPT).
Going out of the ASX 100 is Janus Henderson Group Plc (ASX: JHG) as it struggles with passive index investing and Brexit. Adelaide Brighton Ltd. (ASX: ABC) will also be exiting on Australian construction worries.
S&P / ASX 200 Rebalance Changes
Healthcare business Clinuvel Pharmaceuticals Limited (ASX: CUV) and telecommunications business Service Stream Limited (ASX: SSM) are entering the ASX 200. They are replacing Seven West Media Ltd (ASX: SWM) and Syrah Resources Ltd (ASX: SYR).
Ship builder Austal Limited (ASX: ASB) is also on course to enter the ASX 200 as long as the Navitas Limited (ASX: NVT) takeover goes ahead which needs shareholder and final court approval.
I think the ASX 200 changes are the most interesting because it causes ASX 200 index funds to buy the businesses entering the index and sell the ones being removed. But, I wouldn’t necessarily buy any shares just because they are entering the index.
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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).
At the time of publishing, Jaz does not have a financial interest in any of the companies mentioned.