S&P and the Australian Securities Exchange (ASX) have jointly created an All Technology index which will launch on 24 February and have a total market capitalisation of more than $100 billion.
The index would be a broad representation of 46 ASX-listed technology-focused companies, including small-cap companies which were not yet members of the ASX 300 and those which have recently listed.
While there are already indices which focus on specific areas such as information technology and healthcare, this index would include companies from multiple sectors such as consumer electronics, internet and direct marketing retail, interactive media and services and healthcare technology.
The ASX said the number of companies eligible for the index had nearly doubled in the past five years from 24 to 46, necessitating the need for the index.
“In a market heavily concentrated in banks and natural resource companies, there is significant demand for an index that captures the Australian technology sector in a comprehensive, yet precise way.
“Importantly, the technology segment measures a unique, innovative part of the market that remains a small portion of the broader Australian share universe. We also expect the index to increase the visibility of technology-related businesses listed on the ASX, which should support further growth of the sector over time.”
It had also entered into agreement with BetaShares for the index to be used to develop exchange traded products.
Michael Orzano, senior director of global equity indices at S&P Dow Jones Indices, said: “We are excited to take part in Australia’s ongoing economic growth and innovation story through the launch of the S&P/ASX All Technology Index.
“Australian and global investors will now have a way of tracking these technology companies, further contributing to the growth and liquidity of the sector.”
The largest 10 companies on the index at launch were:
- REA Group
- Next DC