ASEAN Launches Joint Stock Index
SINGAPORE – Seven of the regional ASEAN stock exchanges are to jointly launch their own ASEAN/FTSE Index. The Indonesia Stock Exchange (IDX), Philippine Stock Exchange (PSE), Singapore Exchange (SGX), Bursa Malaysia (KLSE), Stock Exchange of Thailand (SET), Ho Chi Minh City Stock Exchange (HSX) and Hanoi Stock Exchange (HNX) are to sign agreements for the new index today, which will be launched in Indonesia.
The new index will be made of 180 equities, including 30 of the largest stocks from several of the countries involved, according to SET President Charamporn Jotikasthira. For example, the index will contain the top 30 stocks, by market capitalization, from Thailand’s SET50 index.
The ASEAN stock exchanges’ joint effort is aimed at attracting greater regional and international attention for the economic bloc’s top companies and will act as a barometer to gauge ASEAN’s public sector performance as a whole.
“It marks the first collaboration of ASEAN stock markets in providing comprehensive information to investors to attract global funds and institutions,” comment Charamporn.
The ASEAN/FTSE index will also be utilized in the future to create additional investment products, such as index-linked funds and derivative products.
Currently, there are over 3,600 public companies listed on bourses throughout ASEAN, which had a combined market capitalization in 2012 of over US$2 trillion.
Chris Devonshire-Ellis of Dezan Shira & Associates comments, “This further institutionalizes and will help upgrade the operational performance of local regional exchanges, as well as offer a convenient platform for investors wishing to buy into companies that are becoming Pan-Asian MNCs. Although Singapore will develop as the largest regional exchange in ASEAN due to its free trade and internationalized currency, this index will act as a great starting point for domestic companies wishing to raise funds to expand beyond their home country and further afield into ASEAN.”
Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. Since its establishment in 1992, the firm has grown into one of Asia’s most versatile full-service consultancies with operational offices across China, Hong Kong, India, Singapore and Vietnam in addition to alliances in Indonesia, Malaysia, Philippines and Thailand as well as liaison offices in Italy and the United States.
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