Tokyo Stock Price Index - TOPIX (TPX/09M-TO)

Japan Today  Sep 26  Comment 
Tokyo stocks slipped 0.88% on Friday following a sell-off on Wall Street. The key Nikkei 225 index at the Tokyo Stock Exchange, which closed at a seven-year high on Thursday, fell 144.28 points to 16,229.86, while the Topix index of all...
Japan Today  Sep 25  Comment 
Tokyo stocks rose 1.28% to a new seven-year high on Thursday as the dollar surged against the yen following a rally on Wall Street. The Nikkei 225 index at the Tokyo Stock Exchange gained 206.69 points to finish at 16,374.14, its highest close...
SeekingAlpha  Sep 24  Comment 
By Chris Puplava: In June 2012, Japan was facing a ticking time bomb of enormous debt. Given the reliable pattern we've seen over the years by central banks, I didn't have to go too far out on a limb to predict "Massive Japanese Debt Monetization...
The Economic Times  Sep 22  Comment 
The Nikkei declined 0.7 per cent to 16,205.90, with a 6.1 percent slide in Softbank shares accounting for more than a half of the benchmark's fall.
The Economic Times  Sep 12  Comment 
The broader Topix index of all first-section shares rose 0.19 per cent, or 2.48 points, to finish at 1,313.72. It climbed 1.55 per cent over the week.




 
TOP CONTRIBUTORS

The Tokyo Stock Price Index is the composite index for the Tokyo Stock Exchange tracking all domestic stocks from the First Section of the exchange. The index is a measure of the market value changes of the common stocks on the TSE. The TOPIX can be mapped back to its base date on January 4th, 1968 and its base value of 100 points[1].

Weighting and Calculations

TOPIX shows the measure of current market capitalization assuming that market capitalization as of January 4 ,1968 is 100 points. The index is formulated as such[2]:

  • The index computation is as follows: Current aggregate Market Capitalization x 100 /Base Aggregate Market Capitalization

Where the aggregate market capitalization is calculated as:

  • Σ(Price of stock* Number of shares)*free float factor/Index divisor.

The Free float Adjustment factor represents the proportion of shares that is free floated as a percentage of issued shares and then its rounded up to the nearest multiple of 5% for calculation purposes. To find the free-float capitalization of a company, first find its market cap (number of outstanding shares x share price) then multiply its free-float factor. The free-float method, therefore, does not include restricted stocks, such as those held by company insiders.

While one might track this portfolio’s value in dollar terms, it would probably be an unwieldy number. Rather than deal with ten or more digits, the figure is scaled to a more easily handled number. Dividing the portfolio market value by a factor, usually called the Index divisor, does the scaling.

Composition

Eligibility

Since the TOPIX covers all the domestic stocks on the First section of the Tokyo Stock Exchange, the criteria for the TOPIX is the same as the one established for selection of stocks in the First Section. They are[3]:

  • There should be more than 800 shareholders in the company
  • Number of tradable shares must be more than 4000. Tradable shares refers to listed shares which exclude shares owned by the company, officers, and people who own more than 10% of the company listed shares.
  • The Tradable shares ratio to the listed shares must exceed 30%
  • Market Capitalization for the 1st section listed shares should exceed 50 billion yen.
  • Shareholders equity must be at least 1 billion yen in the past fiscal year.
  • Annual total of pre-tax profit for the last two years should be 500 million yen (400 million yen for the past fiscal year) or the last three years be 600 million yen.

List of companies

The TOPIX covers all the companies on the first section of the Tokyo Stock Exchange. As of 10th November 2008, there were 1713 companies listed on the first section of the TSE[4]. The market value for the index on the same date, was 294,733 Billion Yen, with a trading volume of 212 million shares[5].

References

  1. TOPIX Index
  2. TOPIX Index facts
  3. List Criteria for the TSE
  4. TSE Search
  5. TSE First section statistics
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