The ASX 200 Index

ASX 200 - Australian index

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.

Definition

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.

Company Qualifications

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

Sectors

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
CSR Ltd 2,04,34,60,000 Stockland 8,41,67,60,000
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.

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