Managers move toward ASX 200
Fund managers have overwhelmingly supported the Australian Stock Exchanges new market index, the ASX 200 as the benchmark Australian equities index.
Fund managers have overwhelmingly supported the Australian Stock Exchanges new market index, the ASX 200 as the benchmark Australian equities index.
According to an InTech survey, 75 per cent of passive managers and 62 per cent of active managers are in favour of the ASX 200 as the most appropriate bench-mark.
The choice of a benchmark for pooled Australian share funds is up to each indi-vidual manager. While most managers seem set to choose the ASX 200, some might decide on a different index which they think better suits their management style.
The survey showed 13 per cent of passive managers, and 2 per cent of active man-agers were in support of the ASX 100. Support for the ASX 300 was 32 per cent from active managers and only 12 per cent from passive managers.
The least appealing index was ASX 500 with only 4 percent interest from active managers and nil interest from passive managers.
The survey results concluded that "large cap managers" are more likely to slant towards the ASX 100 with its popularity of companies above $1 billion in capi-talisation. However, managers with a "small cap bias" may favour the ASX 300 for companies at or above $50 million.
Following the share market's milestone change, the Australian industry now have a range of indices that can be used as performance benchmarks for Australian share portfolios.
Instead of the old All Ordinaries Index, representing about 90% of the market by market capitalisation with approximately 250 constituent stocks, there are now four separate indices, the ASX 100, 200, 300 and 500.
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025 with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
