Stock market indices are essential for portfolio management, serving as benchmarks for measuring performance and tools for controlling market risks.

Indices are constructed to be representative of an entire market, a single sector or a population of specific stocks. For its component companies, an index is a vehicle for reaching a broad customer base comprising investors, investment managers and analysts.
To meet the needs of derivatives markets while providing suitable benchmarks for managing equity portfolios, Euronext has developed a consistent range of capitalisation-weighted indices calculated in the form of price indices and return indices. Euronext itself computes and publishes the index values.

In 2003 Euronext started to rethink its approach, with the aim of raising the profile and liquidity of medium-capitalisation stocks. This led to the creation of a single regulated market in which stocks are listed in alphabetical order, with each stock also being identified by its capitalisation: large, medium or small. The revised listing format will be inaugurated in Paris in February 2005 before being rolled out in all Euronext markets. At the same time, new mid-cap indices will be created to meet investor needs and round out the range of existing indices.

The new range of Euronext indices has benefited from this overhaul. Liquidity – a key criterion for investors who trade the component stocks – is now given greater consideration in selecting the stocks that make up each index. In all the indices, capitalisation weights are now adjusted to reflect the free float (1),  in line standard international practice.

The new range consists of six indices – CAC 40®, CAC Next20, SBF 80, SBF 120, CAC Mid100 and CAC IT20 – that are calculated every 30 seconds between 9 am and 5.30 pm; and five indices – CAC AllShares, SBF 250, CAC Small90, CAC Mid&Small190 and CAC IT® – that are calculated twice a day, on opening and closing prices.

This family comprises 4 existing indices (CAC 40, SBF 80, SBF 120, SBF 250 and CAC IT ex-IT CAC) and six new indices (CAC Mid100, CAC Small90, CAC Mid&Small190, CAC AllShares, CAC Next20 and CAC IT20). Excepted the CAC AllShares index which will be launched in a second step at 1st July 2005, these new indices will be available from January 3rd, 2005. The other indices like the Second marché, the Nouveau marché, MidCAC and ITCAC 50 indices will be calculated in parallel but their calcul will stop end of June.


(1) Free float is the proportion of shares freely available to the investing public.