(September 22 – 10:30 ET) – Standard & Poor’s says it will launch a new index — the S&P/TSE 60 Capped Index — for Canadian pension and mutual fund clients who are subject to diversification restrictions on portfolio holdings.

The new S&P/TSE 60 Capped Index is based on the existing S&P/TSE 60 Index that was launched on December 31, 1998. The S&P/TSE 60 Capped Index will contain the same constituents as the S&P/TSE 60, except that weights will be adjusted quarterly so that no single stock has a relative weight in the index greater than 10%. Index calculation will commence in November 2000, and real time index values will be available through major quote vendors. Index history will also be made available through the Toronto Stock Exchange.

“The emergence of the S&P/TSE 60 Capped index was a natural progression to the wide acceptance of the S&P/TSE 60 as a leading product index. We were approached by interested parties who expressed a need for a capped version of the S&P/TSE 60” said Glenn Doody, director of Canadian index operations, Standard & Poor’s. It is expected that derivative and ETF products will be launched on this index in the future.

The only constituent that will be capped in the index, currently, is Nortel Networks Corp. Nortel Networks had a relative weight of 41.06% in the S&P/TSE 60 as of September 19, 2000. The next adjustment will take effect December 15, 2000.
-IE Staff