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GEN - Index Change Advice - FTSEJSE Ground Rules Reserve Lists
Reserve Lists for Indices with a Fixed Number of Constituents
FTSE/JSE Africa Index Series
27 January 2014
In order to maintain consistency, and after ratification by the FTSE/JSE Advisory
Committee at their meeting on 11 December 2013, FTSE/JSE announces that reserve
lists will be added to all indices with a fixed number of constituents (excluding the RAFI
40 and Shariah 40).
The following associated rule changes will take effect from March 2014:
Current Rule
5.3 Rules for Insertion and Deletion at the Quarterly Review
5.3.6 A constant number of constituents will be maintained for the FTSE/JSE Top 40
Index and the FTSE/JSE Mid Capitalisation Index. Where a greater number of companies
qualify to be inserted in an index than those qualifying to be deleted, the lowest ranking
constituents presently included in the index will be deleted to ensure that an equal
number of companies are inserted and deleted at the periodic review. Likewise, where a
greater number of companies qualify to be deleted than those qualifying to be inserted,
the securities of the highest ranking companies which are presently not included in the
index will be inserted to match the number of companies being deleted at the periodic
review.
New Rule
5.3 Rules for Insertion and Deletion at the Quarterly Review
5.3.6 A constant number of constituents will be maintained for the FTSE/JSE Top 40
Index, the FTSE/JSE Mid Capitalisation Index, the FTSE/JSE Industrial 25 Index, the
FTSE/JSE Resources 10 Index, FTSE/JSE Financial 15 Index, the FTSE/JSE Financial and
Industrial 30 Index, the FTSE/JSE AltX 15 Index, the FTSE/JSE SA Listed Property Index
and the FTSE/JSE Capped Property Index. Where a greater number of companies qualify
to be inserted in an index than those qualifying to be deleted, the lowest ranking
constituents presently included in the index will be deleted to ensure that an equal
number of companies are inserted and deleted at the periodic review. Likewise, where a
greater number of companies qualify to be deleted than those qualifying to be inserted,
the securities of the highest ranking companies which are presently not included in the
index will be inserted to match the number of companies being deleted at the periodic
review.
Addition of Rule
5.5 Reserve Lists
5.5.2 FTSE/JSE will also be responsible for publishing the three highest ranking non-
constituents of the FTSE/JSE Industrial 25 Index, the FTSE/JSE Resources 10 Index,
FTSE/JSE Financial 15 Index, the FTSE/JSE Financial and Industrial 30 Index, the
FTSE/JSE AltX 15 Index, the FTSE/JSE SA Listed Property Index and the FTSE/JSE
Capped Property Index at the time of the periodic review.
Current Rule
6.1 Removal and Replacement
6.1.3 Where the company to be removed is a constituent of the FTSE/JSE Africa Index
Series apart from the indices in Rule 6.1.2 which has a fixed number of constituents (the
FTSE/JSE Resources 10 Index, the FTSE/JSE Industrial 25 Index, the FTSE/JSE Financial
15 Index or the FTSE/JSE Financial and Industrial 30 Index), the replacement company
will be the highest ranking non-constituent on the day of the evaluation that qualifies for
the index as per its definition in Rule 4.5.
New Rule
6.1 Removal and Replacement
6.1.3 Where the company to be removed is a constituent of the FTSE/JSE Africa Index
Series apart from the indices in Rule 6.1.2 which has a fixed number of constituents (the
FTSE/JSE Resources 10 Index, the FTSE/JSE Industrial 25 Index, the FTSE/JSE Financial
15 Index, the FTSE/JSE Financial and Industrial 30 Index, the FTSE/JSE AltX 15 Index,
the FTSE/JSE SA Listed Property Index or the FTSE/JSE Capped Property Index), the
replacement company will be the highest ranking company in the relevant Reserve List
as described in Rule 5.5.2.
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