The Hang Seng Index (SEHK: ^HSI) is the most commonly used barometer of the Hong Kong stock market.
It consists of 52 blue-chip companies listed on the Hong Kong Stock Exchange (HKEX), covering 57.6% of the exchange’s total market capitalization.
However, the composition of the exchange has changed dramatically over the years.
Companies from Mainland China now form 79% of the HKEX, a striking increase from just 41.6% in 2005.
Meanwhile, information Technology (IT) companies also overtook the Financial sector as the largest industry in 2019.
In order to reflect the respective shifts of the market, Hang Seng Indexes Company (HSIC) recently proposed five enhancements to the HSI.
The final decision and details on the changes will be announced in February 2021.
1. Expanding Industrial Representation
The first proposed change will consolidate the current list of 12 industries into six groups.
Companies will then be selected to join the HSI based on the target coverage ratio for each industry group....
