(November 17 – 15:10 ET) – Standard & Poor’s is launching a new index which caps every component’s weighting to 10%. The S&P/TSE 60 Capped Index has been developed for Canadian pension and mutual fund clients who are subject to diversification restrictions on portfolio holdings.

The launch would have been problematic earlier this year when Nortel Networks made up approximately 35% of the TSE 300, but throughout the last month the company’s stock has dropped about 60% off its high.

The new index will be disseminated on a real-time basis, beginning at the market open on November 20.

S&P says 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. It will contain the same stocks as the S&P/TSE 60, except that weights will be adjusted quarterly so that no one stock has a relative weight in the index greater than 10%.
-IE Staff