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An interesting read.............Press on the link below to read the full article


<h1 class="cN-headingPage prepend-5 span-11 last">Let the index provider be your guide </h1>BIANCA HARTGE March 5, 2010 - 1:01PM


When it comes to portfolio construction, whatÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s hot and whatÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s not in stocks can generally be decided by watching the index.


A 2007 paper, albeit based on data from April 2000 ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â‚¬Å¡Ã‚¬Ãƒâ€¦Ã‚¡ÃƒÆ’‚¬Ãƒâ€Â¦ÃƒÆ’¢Ã¢Ã¢â‚¬Å¡Ã‚¬Ãƒâ€¦Ã¢â‚¬Å“ Dec 2002, The Index Effect: An Investigation of the Price, Volume and Trading Effects Surrounding Changes to the S&P Australian Indices by Daniel Pullen, (University Melbourne) and Gerard Gannon(Deakin University) found a significant rise or fall in the 10 days following the announcement of the changes, only for the moves to revert after implementation.


Here we look at changes to the S&P/ASX 200 made in December and whether making money is as simple as buying the additions and selling the deletions, but first some background.


Inclusion in an index is regarded as positive, removal negative. And the driver - institutional money entering and leaving the stock based on which stocks they are allowed to hold.



Institutional managers are governed by their mandates. In most cases that means being restricted to investing in the top 200 or 300 stocks.



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Check this out, you can actually now place a bet where the index will be thru CENTREBET..........................


<h1 class="cN-headingPage prepend-5 span-11 last">Are stocks a gamble? You bet </h1>



March 8, 2010 - 1:23PM Fancy a flutter on the financials?


From today Australians can place a bet on where the S&P/ASX 200, the index of the nation's 200 biggest listed companies, will finish at the end of the month.


Centrebet's bourse book shows that so far, most punters expect the market will rise in March. There are longer odds on a fall or steady result.


Company spokesman Neil Evans said the product was designed to lure financial specialists towards Centrebet along with "across the board punters who just like to have a go on these sorts of things".


"It is a straight up and down betting book but it is a futures book," Mr Evans said.


Punters have been able to bet on Reserve Bank rates moves through betting agencies, including Centrebet, for several years.


"In that time, nearly $1 million has been bet with us on the RBA's rate decision. Now, market punters can bet on the ASX 200 indicator, with three end-of-month prices regularly updated," Mr Evans said.


"This is something we have been working on for months, and believe it will ignite a new wave of financial punters."


Traders can already profit from taking a position on how the market will perform by buying a futures contract - however these must be purchased through a licensed broker and are traded on the Sydney Futures Exchange.


And unlike other index-related financial products that are traded through the ASX, such as exchange-traded funds, Centrebet is not offering clients the chance to buy into a managed fund or underlying asset.


The company, which is listed in its own right, will now push to expand market-based bets to cover shares and commodities, such as oil and gold, as well.


Centrebet does not need a financial licence to provide the service, and is operating within its gambling licence, Mr Evans said.


"We do not have to take it to the ASX or anyone else and ask for clearance."


A spokesman for the ASX confirmed the market regulator had no jurisdiction over Centrebet's offering.



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Others would have noticed I'm sure,but turnover today is very low (so far at least).At this rate some brokers may have to go out and get a real job. (doing what,you ask).

The low market turnover of late is not a great sign imo.

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