The ASX 200 is a market capitalization weighted and float-adjusted stock market index for the Australian markets comprised of 200 companies. ASX is an acronym which stands for Australian Securities Exchange, the prime exchange for Australian stocks based in Sydney.
The ASX 200 is gauged in points or percentages and records the combined movements of all 200 stocks included in the index. The index makes quarterly rebalances where the index adds and removes companies that are qualified and those that are no longer qualified to be in the index.
ASX 200 index or S&P/ASX 200 stands for Australian Securities Exchange, which is a Sydney based share market of Australia. The index is the barometer for the top 200 firms of Australia by market capitalisation and was started in the year 2000. Notably, the index keeps updating every three months so that only real-time top 200 companies are listed, thus, removing or adding organisations using their last six months data.
Further, the index is continuously changing in terms of points or percentage, which continuously gets affected by the listed companies.
ASX 200 Market Cap Definition
Market cap or Market capitalisation is the value of the share capital issued by a company. In simple words, the value is calculated after multiplying the number of shares by the stock price.
Similarly, the ASX 200 market cap is the value of the top 200 listed companies from the Australian Securities Exchange.
There are three conditions a stock must satisfy in order to be included in the index:
• The stock must be listed on the Australian Securities Exchange as an ordinary or preferred stock
• The stock must meet liquidity requirements. Liquidity translates to how often the certain stock is traded at what quantity. This will tell how easily an investor can buy or sell the stock. The ASX 200 requires stock to be at a certain level of liquidity and the liquidity must not be comprised of a small number of investors.
• The stock’s float-adjusted market capitalization must also meet the requirements of the index. For the ASX 200, it means that the company’s float adjusted market capitalization must be among the top 200 of the biggest on the ASX.
These are the conditions a stock must meet in order to be included in the index, but it doesn’t mean companies already in the index are immediately taken out once they fall outside the conditions.
How to Trade with ASX 200 index companies?
The most effective way to invest in the ASX 200 index is through a brokerage firm or trading website. There are several brokers out there but make sure to check the following in them:
• Licenses and Regulations from trusted authorities
• Wide range of Financial Products
• Easy to Use and Simple trading platform
• No charge and Low cost
It is difficult to find the right broker nowadays; however, here are some top-rated trading sites.
Oinvest: Oinvest is a trading broker which offers several CFD products to its users. The broker is a Seychelles based investment firm which provides almost every type of market including crypto, shares, forex, indices, metals, commodities, etc. Note that Oinvest is a trading name of Aronex Corporation Ltd, which is a registered firm in the nation.
The firm is regulated by the Financial Service Authority (FSA) with regulation number SD 014. Moreover, the trading site offers trading in MetaTrader 4, accessible via mobile, web, and desktop, for both Android and iOS.
Apart from this, some other prominent features of the company are free demo account, high leverage service, and excellent customer service.
2invest: 2invest is a Mahe based trading site which started its brokerage firm in 2018. The firm is dedicated to offering broking services at tight spreads, with regulations from governing bodies like FSC (Financial Service Authority). The firm provides trading via three different kinds of accounts, namely, silver, gold, and platinum, with the last one offering the most benefits.
However, the broker is not available to provide its services in Africa, the US, or Europe. Research tools include earnings, market analysers, economic calendar, sentiment examiners, etc., while the education content includes, videos, E-books, journals, articles, courses, etc.
Notably, the trading website also provides Islamic account type.
HFtrading: HFtrading is a brand name of CTRL Investments Ltd. and offers CFD trading on several assets including commodities, stocks, crypto, indices, currencies, and ETFs. The firm offers around 350+ financial products, available for trading free of cost at no extra hidden charges or commission. The broker regulates under the top tier financial bodies, ASIC (Australian Securities & Exchange Commission) and New Zealand’s Financial Market Authority.
Furthermore, the firm provides trading platform Meta Trader4, which offers extra tools for investment & trading, accessible via desktop, mobile, and web versions. You can withdraw or deposit money via the firm’s comprehensive payment options which include bank transfer, credit/debit cards, and e-Wallets like Skrill & Neteller. Meanwhile, there are dedicated research & education library, which aids traders to make better trading decisions and price predictions.
You can open a demo account service with hftrading in three easy steps.
ETfinance: ETfinance is a Cyprus headquartered organisation that started its operations in 2019 and bears high regulations from top tier governing body, CySEC. There are around 350 trading products by the broker, offering CFD investment on the following market types: cryptocurrencies, currencies, stocks, indices (including ASX 200 index), and commodities. The assets are tradable via three account types, silver, gold, and platinum.
Further, the firm’s widely recognised Meta Trader4 platform provides customers with unprecedented experience and tools. You can contact the broker from Monday to Friday, 02:00 to 13:00, through telephone, live chat support, email, or contact form.
ASX 200 Index Listing Criteria
Every organisation that wishes to get listed on the ASX 200 index must fulfil the following three criteria:
The firm’s stock should be publicly listed on the Australian Securities Exchange, either as preferred or ordinary share.
The listed venture must satisfy the liquidity requirement. Liquidity translates to how often the certain stock is traded at what quantity. This will tell how easily an investor can buy or sell the stock. The ASX 200 requires stock to be at a certain level of liquidity, and the liquidity must not be comprised of a small number of investors.
The stock’s float-adjusted market capitalisation must also meet the requirements of the index. For the ASX 200, it means that the company’s float-adjusted market capitalisation must be among the top 200 of the biggest on the ASX.
Factors affecting the ASX 200 Index
Indices trading are made up of top companies of a nation and thus, if the stock prices of that firms are affected, then it has an impact on indices too. Some of the significant factors affecting the ASX 200 index are:
Economic Growth: Better economic growth will boost the economy and consumer expenditure, thus, increased demand for goods & services. It would benefit the organisations and thus their stock prices.
Interest Rates: Lower interest rates are beneficial for the indices in two ways. First, low rates are not lucrative to people depositing money in banks for interest and thus moving their focus to stocks. Second, companies taking loans from financial institutions have to pay lower interest on their lending and thus, make more profits.
Other Markets: Indices market is greatly affected by other markets in the nation, such as stocks, forex, commodities, bonds, etc. If the currency price falls, more people would invest in the country in the form of FDI and thus, benefiting the indices. Similarly, if the bond market is down and the prices are falling, people would shift their investments towards stocks.
Calculations and Weighting
The index uses the market capitalisation method. The index uses its float, the shares readily available for trading instead of the outstanding shares of a company. The free-float method does not include stocks held by insiders of the company.
The formula is:
Index level = Summation of (Price of any stock * Quantity of the stock)/ Index Divisor
Ten sectors make up the ASX 200 index:
The financial sector which makes up 47.2% of the index,
The materials sector which makes up 14.5%,
The healthcare sector at 6.4%,
The industrial sector which is 7.5%,
Consumer staples at 7%,
Telecommunications services at 5.8%,
The Consumer discretionary at 4.3%,
The energy sector at 4.5%,
The utilities sector at 2.3% and
The information technology sector at 0.7%.
ASX 200 Companies
|Company||Market Cap||Company||Market Cap|
|Abacus Property Group||1,67,95,00,000||Link Administration Holdings Ltd||2,16,37,40,000|
|Adbri Ltd||1,93,07,10,000||Lynas Corporation Ltd||1,46,44,90,000|
|Afterpay Ltd||12,76,70,00,000||Magellan Financial Group Ltd||10,66,89,00,000|
|AGL Energy Ltd||10,53,77,00,000||Mirvac Group||9,04,80,70,000|
|Als Ltd||3,40,11,00,000||Mineral Resources Ltd||3,65,63,10,000|
|Altium Ltd||4,88,63,30,000||Mcmillan Shakespeare Ltd||68,40,49,000|
|Alumina Ltd||4,36,29,60,000||Monadelphous Group Ltd||1,12,34,80,000|
|Amcor Plc||14,53,22,00,000||Medibank Private Ltd||7,76,62,90,000|
|AMP Ltd||5,75,63,00,000||Macquarie Group Ltd||39,15,56,00,000|
|Ansell Ltd||4,59,61,40,000||Metcash Ltd||2,75,01,60,000|
|AP Eagers Ltd||1,67,77,70,000||Mayne Pharma Group Ltd||71,36,04,000|
|APA Group||13,59,24,00,000||National Australia Bank Ltd||57,37,22,00,000|
|Appen Ltd||3,75,04,40,000||Nanosonics Ltd||2,16,43,50,000|
|ARB Corporation Ltd||1,37,86,70,000||Newcrest Mining Ltd||25,39,55,00,000|
|Aristocrat Leisure Ltd||16,90,86,00,000||Nearmap Ltd||99,14,48,000|
|ASX Ltd||17,01,51,00,000||Nine Entertainment Co. Holdings Ltd||2,55,80,90,000|
|Atlas Arteria||5,80,25,80,000||New Hope Corporation Ltd||1,13,94,40,000|
|Aurizon Holdings Ltd||9,18,04,70,000||Nib Holdings Ltd||2,09,68,00,000|
|Ausnet Services Ltd||6,52,19,70,000||National Storage REIT||1,80,86,30,000|
|Austal Ltd||1,30,13,70,000||Northern Star Resources Ltd||11,22,65,00,000|
|Australia and New Zealand Banking Group Ltd||51,19,30,00,000||Nufarm Ltd||2,12,24,90,000|
|Avita Medical Ltd||1,04,53,80,000||NRW Holdings Ltd||82,99,03,000|
|Bank of Queensland Ltd||2,38,07,20,000||Netwealth Group Ltd||1,94,67,20,000|
|Bapcor Ltd||1,99,91,40,000||News Corporation||88,54,15,000|
|Beach Energy Ltd||3,80,89,50,000||NEXTDC Ltd||4,09,08,70,000|
|Bega Cheese Ltd||1,14,08,10,000||Ooh!Media Ltd||64,50,49,000|
|Bendigo and Adelaide Bank Ltd||3,29,10,10,000||Orora Ltd||3,23,39,20,000|
|BHP Group Ltd||1,05,19,60,00,000||Orocobre Ltd||68,16,47,000|
|Bingo Industries Ltd||1,65,41,40,000||Origin Energy Ltd||10,70,82,00,000|
|Blackmores Ltd||1,44,42,50,000||Orica Ltd||7,04,18,30,000|
|Bluescope Steel Ltd||5,63,95,40,000||Oil Search Ltd||7,37,63,70,000|
|Boral Ltd||4,06,91,70,000||OZ Minerals Ltd||3,12,19,30,000|
|Brambles Ltd||17,63,59,00,000||Pendal Group Ltd||2,01,42,90,000|
|Bravura Solutions Ltd||1,19,48,40,000||Pilbara Minerals Ltd||58,92,82,000|
|Breville Group Ltd||3,07,66,80,000||Pro Medicus Ltd||3,04,77,20,000|
|Brickworks Ltd||2,34,35,20,000||Premier Investments Ltd||2,60,30,80,000|
|BWP Trust||2,37,04,00,000||Pinnacle Investment Management Group Ltd||78,15,08,000|
|Caltex Australia Ltd||6,32,25,80,000||Polynovo Ltd||1,77,83,30,000|
|Carsales.com Ltd||3,99,57,70,000||Perpetual Ltd||1,44,96,20,000|
|Challenger Ltd||3,02,47,60,000||Perenti Global Ltd||86,62,64,000|
|Charter Hall Group||4,54,13,30,000||Platinum Asset Management Ltd||2,21,17,80,000|
|Charter Hall Long Wale REIT||2,07,87,20,000||Qantas Airways Ltd||5,97,80,80,000|
|Charter Hall Retail REIT||1,84,41,50,000||QBE Insurance Group Ltd||12,84,09,00,000|
|Chorus Ltd||3,10,70,00,000||QUBE Holdings Ltd||5,16,08,40,000|
|Cimic Group Ltd||8,16,97,90,000||REA Group Ltd||13,54,03,00,000|
|Cleanaway Waste Management Ltd||4,08,73,50,000||Ramsay Health Care Ltd||15,94,16,00,000|
|Clinuvel Pharmaceuticals Ltd||1,14,87,90,000||RIO Tinto Ltd||36,09,34,00,000|
|Coca-Cola Amatil Ltd||6,29,88,00,000||Resmed Inc||8,58,57,50,000|
|Cochlear Ltd||12,74,40,00,000||Regis Resources Ltd||2,77,97,50,000|
|Coles Group Ltd||20,64,92,00,000||Resolute Mining Ltd||1,29,58,20,000|
|Collins Foods Ltd||92,79,87,000||Reliance Worldwide Corporation Ltd||2,41,76,90,000|
|Commonwealth Bank of Australia||1,13,11,80,00,000||SOUTH32 Ltd||9,45,02,20,000|
|Computershare Ltd||7,17,74,70,000||Saracen Mineral Holdings Ltd||5,76,81,20,000|
|Cooper Energy Ltd||68,31,92,000||ST Barbara Ltd||2,28,50,60,000|
|Corporate Travel Management Ltd||1,32,00,00,000||Scentre Group||11,36,69,00,000|
|Costa Group Holdings Ltd||1,28,26,60,000||Shopping Centres Australasia Property Group||2,41,06,90,000|
|Credit Corp Group Ltd||1,06,51,90,000||Steadfast Group Ltd||2,88,31,10,000|
|Cromwell Property Group||2,12,94,90,000||Seek Ltd||7,12,94,40,000|
|Crown Resorts Ltd||6,54,13,50,000||Sandfire Resources Ltd||81,10,44,000|
|CSL Ltd||1,29,25,40,00,000||Sims Ltd||1,57,26,70,000|
|Dexus||10,01,72,00,000||The Star Entertainment Group Ltd||2,78,86,60,000|
|Domain Holdings Australia Ltd||1,76,44,80,000||Sonic Healthcare Ltd||13,39,06,00,000|
|Domino’s PIZZA Enterprises Ltd||5,35,71,20,000||Smartgroup Corporation Ltd||87,67,79,000|
|Downer Edi Ltd||2,67,02,10,000||Skycity Entertainment Group Ltd||1,60,79,40,000|
|Elders Ltd||1,53,49,40,000||Spark Infrastructure Group||3,59,83,90,000|
|EML Payments Ltd||1,33,80,90,000||Silver Lake Resources Ltd||1,98,84,50,000|
|Estia Health Ltd||39,06,02,000||Washington H Soul Pattinson & Company Ltd||4,63,70,90,000|
|Evolution Mining Ltd||10,73,78,00,000||Spark New Zealand Ltd||7,45,84,00,000|
|Fisher & Paykel Healthcare Corporation Ltd||15,88,28,00,000||Service Stream Ltd||82,42,13,000|
|Fletcher Building Ltd||2,92,61,10,000||Santos Ltd||11,45,69,00,000|
|Flight Centre Travel Group Ltd||2,71,50,50,000||Super Retail Group Ltd||1,68,70,30,000|
|Fortescue Metals Group Ltd||45,53,79,00,000||Suncorp Group Ltd||11,58,81,00,000|
|G.U.D. Holdings Ltd||92,25,00,000||Seven Group Holdings Ltd||5,63,33,40,000|
|G8 Education Ltd||86,17,97,000||Southern Cross Media Group Ltd||59,44,74,000|
|Gold Road Resources Ltd||1,63,62,70,000||Sydney Airport||13,33,30,00,000|
|Goodman Group||28,13,93,00,000||Tabcorp Holdings Ltd||6,60,50,10,000|
|GPT Group||7,79,17,20,000||Transurban Group||39,35,81,00,000|
|Graincorp Ltd||1,00,92,50,000||Tassal Group Ltd||81,76,54,000|
|Growthpoint Properties Australia||2,47,74,10,000||Telstra Corporation Ltd||38,29,64,00,000|
|GWA Group Ltd||81,82,38,000||Technology One Ltd||2,91,90,20,000|
|Harvey Norman Holdings Ltd||4,18,65,80,000||TPG Telecom Ltd||7,66,37,20,000|
|Healius Ltd||1,53,81,70,000||Treasury Wine Estates Ltd||7,03,50,10,000|
|HUB24 Ltd||65,10,86,000||United Malt Group Ltd||1,29,55,10,000|
|Idp Education Ltd||4,77,62,50,000||Unibail-Rodamco-Westfield||1,01,29,60,000|
|IGO Ltd||3,06,03,30,000||Vicinity Centres||5,98,73,20,000|
|Iluka Resources Ltd||3,60,62,30,000||Viva Energy Group Ltd||3,13,07,00,000|
|Incitec Pivot Ltd||3,80,77,50,000||Vocus Group Ltd||1,86,79,20,000|
|Ingenia Communities Group||1,36,82,40,000||Virgin Money Uk Plc||1,62,41,30,000|
|Inghams Group Ltd||1,23,39,80,000||Viva Energy REIT||1,90,53,00,000|
|Insurance Australia Group Ltd||13,93,56,00,000||Westpac Banking Corporation||62,69,88,00,000|
|Invocare Ltd||1,63,48,50,000||Webjet Ltd||1,45,77,10,000|
|IOOF Holdings Ltd||1,68,86,80,000||Wesfarmers Ltd||46,10,19,00,000|
|IPH Ltd||1,62,94,10,000||Whitehaven Coal Ltd||1,81,61,00,000|
|Iress Ltd||1,97,80,00,000||Worley Ltd||4,47,53,20,000|
|James Hardie Industries Plc||11,69,02,00,000||Woolworths Group Ltd||44,56,18,00,000|
|Janus Henderson Group Plc||1,23,41,70,000||Woodside Petroleum Ltd||21,88,34,00,000|
|JB Hi-Fi Ltd||4,36,09,70,000||Western Areas Ltd||63,56,99,000|
|Jumbo Interactive Ltd||74,09,70,000||Wisetech Global Ltd||6,52,05,50,000|
|Lendlease Group||8,68,85,40,000||Xero Ltd||12,29,44,00,000|
|The a2 Milk Company Ltd||12,80,65,00,000|
The Bottom Line
So, this was all the details about the ASX 200 Australian Index. The market has shown immense growth, volatility and possesses great potential in the future. Interestingly, the Australian market has been giving an average return on investment (ROI) of 13.5% since 1990. If you want to invest in the index, then make sure to choose a good broker.
HFtrading is a useful trading website bearing FMA and ASIC financial body licenses.