The world’s two major providers of equity index services, Standard and Poor’s and Morgan Stanley Capital International (MSCI), have linked up to launch real time global sector indices for Australia’s S&P/ASX 200 index.
The new indices will re-classify all companies in the S&P/ASX 200 into 12 sectors in accordance with the Global Industry Classification System (GICS), bringing Australia in line with the rest of the world.
GICS was originally launched overseas in 1999 as a means of establishing a global standard for categorising companies into sectors and industries, thereby enabling fund managers and asset consultants to make global comparisons of stocks along industry lines.
“The introduction of indices based upon the GICS classification system in Australia will help market participants ascertain whether local stock movements are part of a global trend or more locally based,” Standard & Poor’s Australian director of index services Jason Feldmayer says.
“Having 12 global sector indices also means that each index group will be sizeable and liquid enough to be relevant in an index linked product sense, such as for exchange traded funds or futures contracts that may one day emerge in Australia.”
