FTSE Russell and Nomura Securities Co., Ltd. today announced that 151 new stocks were added to the Russell/Nomura Total Market Index, which captures 98% of the float-adjusted market capitalization of the Japanese equity market, as part of the annual reconstitution process on 20 November 2017. The new membership list for the indexes was posted on the FTSE Russell website.
Catherine Yoshimoto, senior product manager, FTSE Russell:
‘We are delighted to complete another annual reconstitution with our valued partners at Nomura Securities. It is our annual reconstitution process that ensures the indexes remain a relevant reflection of the Japan equity markets for investors.’
Increase in market capitalization reflects rise in Japan equity markets.
The number of constituents in the Russell/Nomura Total Market Index increased by 114 to 1,600. There were 151 additions to the Index and 37 companies were deleted, with market cap weighted turnover at a modest 1.6%. Total market capitalization of the Index was approximately 430 trillion yen (as of 13 October, 2017, float-adjusted), a 28% increase from the index's total market cap at 2016 reconstitution.
Total constituents for the Russell/Nomura Large Cap Index, representing the top 85% of the Russell/Nomura Total Market Index based on float-adjusted market capitalization, included the same 350 companies as at 2016 reconstitution. The number of stocks in the Russell/Nomura Small Cap Index (including 800 Micro Cap stocks), representing the bottom 15% of the Total Market Index based on float-adjusted market capitalization, increased to 1,250.
The Russell/Nomura Total Market Value Index had 134 additions and 95 deletions, while the Russell/Nomura Total Market Growth Index had 210 additions and 87 deletions. Market cap weighted turnover for the Value and Growth Indexes are 9.1% and 9.8% respectively, both below turnover at 2016 reconstitution.
Sector shifts this year include a Value tilt for Land Transportation and Retail Trade sectors in the Large Cap Index while weights in Electric Appliances, Chemicals and Machinery sectors increased over 1% in the Large Cap Growth Index. Sector characteristics may differ for the Small Cap Index, such as the Growth tilt for Land Transportation.
Russell/Nomura Prime Index adds 20 new companies
The Russell/Nomura Prime Index, which is a sub-index of the Russell/Nomura Total Market Index, was designed as a benchmark for passive management strategies for institutional investors. The Index includes the top 1,000 float-adjusted stocks from the Russell/Nomura Total Market Index, representing all market cap segments with an additional liquidity screen and banding applied at reconstitution to decrease turnover.
The total market cap of the Prime Index is approximately 418 trillion yen (97.2% of the Total Market Index), with turnover of 1.5%. As of 2017 reconstitution, 20 companies, including two IPOs, entered the Prime Index for the first time. 19 of these companies were added to the Prime Growth Index, and only one company was added to the Prime Value Index.
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