The Nigerian Stock Exchange (NSE) has announced the revision of the NSE-30, and the seven sectoral indices of the Exchange. These Indices are NSE Consumer Goods, NSE Banking, NSE Insurance, NSE Industrial, NSE Oil & Gas, NSE Pension and the NSE Lotus Islamic Indices. These indices are normally reviewed bi-annually (June and December) except for NSE Pension index that is reviewed once in the year (December).
The NSE in a statement yesterday said the review process will see the entry of some major companies and the exit of others from the various indices.
According to the statement, the Index review will become operational on January 3, 2017 (yesterday).
“There were 123 Trading Days during the review period of June 24, 2016 and December 23, 2016,” it said.
The NSE-30 and NSE Industrial Indices are modified market capitalization index with the numbers of included stocks fixed at 30 and 10, respectively. The Stocks are selected based on their market capitalization from the most liquid sectors.
The liquidity is based on the number of times the stock is traded during the preceding two quarters. To be included, the stock must have traded for at least 70 percent of the number of times the market opened for business.