Exchange to Implement Special Changes to Value-Up Index Constituents on the 20th of Next Month

The Korea Exchange announced on the 18th that it will implement a special change to the components of the 'Korea Value-Up Index' within this year, with the component changes scheduled for the 20th of next month.

Korea Exchange, Yeouido, Seoul. Photo by Jinhyung Kang aymsdream@

This special change became necessary as the number of companies that have fulfilled or plan to fulfill value-up disclosures within the year has increased since the index announcement on September 24, making it essential to early include some companies that are faithfully implementing the value-up policy into the index.

The companies subject to the new inclusion review are those that have fulfilled the disclosure of corporate value enhancement plans by the 6th of next month following the announcement of the Korea Value-Up Index. Considering this is a special change, the Exchange plans to conduct special inclusions within a limited scope to avoid inconvenience in the operation of linked products such as Exchange-Traded Funds (ETFs).

The Exchange stated, "This special rebalancing within the year was decided for December 20, aiming to include as many companies that have fulfilled value-up disclosures as possible, while comprehensively considering opinions from the asset management industry. Also, taking into account that the inclusion review, index operation committee deliberation, prior notice, and actual rebalancing preparation by asset managers require at least about two weeks, the selection date for companies subject to review was set as December 6."

The number of specially included components is yet to be determined, and the Exchange will finalize it considering the scale and trend of the review candidates in the future.

Regarding removals, these are planned to be conducted during the regular changes in June next year. A representative from the Exchange said, "If existing components are removed early due to this special rebalancing, unforeseen damages to the companies and investors are expected. Considering such investor damages and convenience in operating linked products, only special inclusions will be conducted during this rebalancing, and removals will be carried out during the regular changes in June next year." They added, "As a result, the number of components will temporarily increase, but it will return to 100 components through removals during the regular changes in June next year."

This content was produced with the assistance of AI translation services.