The bourse is launching today the EGX70 Equal Weight Index (EWI), which allocates all listed companies an equal weight of c.1.43% of the index on the first day of each quarterly review. This will make the performance of each company within the index, which excludes EGX30 companies, of equal weight. The index will replace the traditional EGX70, and should allow index funds — or investment funds that track stock exchange indices — to better measure their performance, reads a statement from the EGX (pdf). The bourse also issued a short guidebook outlining its methodology (pdf).

The S&P 500 also has an equally-weighted counterpart that allocates each constituent 0.2%. MSCI also has several equally-weighted versions, including the MSCI USA Equal Weighted Index.

Tags: