TAIEX: Difference between revisions
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The '''Taiwan Stock Exchange Capitalization Weighted Stock Index''' ('''TAIEX''') is the principal broad-market [[stock market index]] of the [[Taiwan Stock Exchange]] (TWSE). It measures the aggregate performance of stocks listed on the TWSE and is compiled and maintained under rules established by the exchange. The index is widely used as a benchmark for the Taiwan securities market. | The '''Taiwan Stock Exchange Capitalization Weighted Stock Index''' ('''TAIEX''') is the principal broad-market [[stock market index]] of the [[Taiwan Stock Exchange]] (TWSE). It measures the aggregate performance of stocks listed on the TWSE and is compiled and maintained under rules established by the exchange. The index is widely used as a benchmark for the Taiwan securities market. | ||
TAIEX is a [[market capitalization-weighted index]], meaning that companies with larger market values have a greater influence on the index. | TAIEX is a [[market capitalization-weighted index]], meaning that companies with larger market values have a greater influence on the index. | ||
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==History== | ==History== | ||
TAIEX is the first self-compiled stock index of the Taiwan Stock Exchange. Its base is the annual average of 1966, with a base value of 100 points. The index was launched in November 1970. | TAIEX is the first self-compiled stock index of the Taiwan Stock Exchange. Its base is the annual average of 1966, with a base value of 100 points. The index was launched in November 1970. | ||
The historical base can be represented as: | The historical base can be represented as: | ||
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==Composition== | ==Composition== | ||
The TAIEX constituent universe consists of common stocks listed on the Taiwan Stock Exchange, subject to the eligibility and maintenance provisions of the TAIEX methodology. | The TAIEX constituent universe consists of common stocks listed on the Taiwan Stock Exchange, subject to the eligibility and maintenance provisions of the TAIEX methodology. | ||
Newly listed companies are generally incorporated into the index after one full calendar month from listing. Certain corporate reorganizations, transfers from the Taipei Exchange Mainboard and other specified circumstances are subject to different inclusion rules. | Newly listed companies are generally incorporated into the index after one full calendar month from listing. Certain corporate reorganizations, transfers from the Taipei Exchange Mainboard and other specified circumstances are subject to different inclusion rules. | ||
A simplified representation is: | A simplified representation is: | ||
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</math> | </math> | ||
The aggregate market value is calculated from the trading price and the number of issued shares of each constituent stock. | The aggregate market value is calculated from the trading price and the number of issued shares of each constituent stock. | ||
For an individual constituent, a simplified representation of market value is: | For an individual constituent, a simplified representation of market value is: | ||
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==Calculation frequency== | ==Calculation frequency== | ||
The TWSE calculates and disseminates the TAIEX Price Index during trading hours at five-second intervals using the latest available transaction prices of constituent stocks. An end-of-day index is calculated after the market closes. | The TWSE calculates and disseminates the TAIEX Price Index during trading hours at five-second intervals using the latest available transaction prices of constituent stocks. An end-of-day index is calculated after the market closes. | ||
A simplified calculation process is: | A simplified calculation process is: | ||
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TAIEX is maintained in both a '''Price Index''' and a '''Total Return Index'''. | TAIEX is maintained in both a '''Price Index''' and a '''Total Return Index'''. | ||
The Price Index reflects movements in constituent stock prices. The Total Return Index incorporates the effect of cash dividends and is designed to reflect returns including the reinvestment of cash dividends. | The Price Index reflects movements in constituent stock prices. The Total Return Index incorporates the effect of cash dividends and is designed to reflect returns including the reinvestment of cash dividends. | ||
The distinction can be represented as: | The distinction can be represented as: | ||
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</math> | </math> | ||
The purpose of these adjustments is to prevent changes arising from specified corporate actions from being interpreted as ordinary changes in aggregate market value. | The purpose of these adjustments is to prevent changes arising from specified corporate actions from being interpreted as ordinary changes in aggregate market value. | ||
==Sector exposure== | ==Sector exposure== | ||
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==Related indices== | ==Related indices== | ||
The Taiwan Stock Exchange maintains a range of indices associated with TAIEX and its constituent market. These include sector-exclusion indices and industrial sub-indices. | The Taiwan Stock Exchange maintains a range of indices associated with TAIEX and its constituent market. These include sector-exclusion indices and industrial sub-indices. | ||
Examples include: | Examples include: | ||