The composition of the Philippine Stock Exchange Index (PSEi) shall be revised effective May 4, 2009 as a result of PSE’s regular indices review. Sectoral indices shall also be adjusted accordingly.
To qualify for the main indices (PSEi), companies are required to meet the following during the review period:
1) Free float level of at least 10%
2) Liquidity or average daily trading value of at least P5 million
3) Volume turnover ratio of at least 10%
4) Tradability of at least 95% of the total trading days
5) Free float market capitalization
On the other hand, to qualify for the sector indices, companies are required to meet the following during the review period:
1) Liquidity or average daily trading value of at least P1 million
2) Tradability of at least 75% of the total trading days
The free float level of all listed companies shall also be updated. The adjustments are based from the companies’ latest public ownership reports as of December 31, 2008 submitted to the PSE by April 3, 2009.
As a result, Petron and Union Bank were dropped from the list of blue chip companies. The two listed companies shall be replaced by Aboitiz Power Corp. and GMA Network Inc.
Petron failed to comply with the 10 percent minimum public or free float level while UnionBank will also be replaced in the index after its average daily value turnover went below the P5 million turnover requisite.
For those following the movement of PSEi, consider these changes on your next stock trading strategy.
