S & P Sri Lanka 20 index launched

Indunil HEWAGE

Colombo Stock Exchange CEO Surekha Sellahewa, S & P Indices , Vice President, Global Equity and Strategy Indices Alka Banerjee, Colombo Stock Exchange Chairman Krishan Balendra, Securities and Exchange Commission of Sri Lanka, Chairman Thilak Karunaratne and S & P Indices Director, Business Development, South Asia Koel Ghosh at the launching ceremony yesterday Picture by Samantha Weerasiri

S &P Sri Lanka 20, a globally recognized index , which has been jointly developed by S and P Indices and Colombo Stock Exchange was officially launched yesterday.

The index is designed to assist the investors both home and abroad to gauge the performance of the Sri Lankan equity market and that include the largest 20 stocks by total market capitalization, listed on the Colombo Stock Exchange that meet minimum size, liquidity and financial viability threshold.

The constituents are weighted by float adjusted market capitalization, subject to a single stock cap of 15 % which is employed to enhance portfolio diversification.

S & P Sri Lanka index has been designed in accordance with global standards and to be eligible for inclusion, stocks must have a minimum float adjusted market capitalization of Rs 500 million, a six month average daily value of Rs 1 million, should have traded at least 10 days of each month for the three months prior to the re-balancing reference date and a positive net income over 12 months prior to the re-balancing reference date.

All stocks are classified according to the Global Industry Classification Standard which is widely used by the market participant across the world.

Speaking at the event Krishan Balendra, Chairman of Colombo Stock Exchange said with a heightened emphasis on economic development, specially the targeted 8-9 + GDP growth, capital market will have to play a pivotal role to raising required capital to drive the expected GDP growth and SEC has also plans to implement few initiatives particularly DVP and risk management system in a timely manner .