The Hang Seng Index

The Hang Seng index (HIS) is used in Hong Kong as a freefloating-adjusted market’s capitalization-biased stock market index. The everyday changes in the general market performance of the biggest companies of Hong Kong stock market is recorded and monitored by this index. There are overall 45 companies, which come under this index, and they characterize 67% of capitalization of the total Hong Kong Stocks Exchange. The major bank of Hong Kong in the terms of market’s capitalization, the Hang Seng Bank, which wholly owns its subsidiary, the HSI Services Limited, started the Hang Seng Index (HSI) on November 24, 1969 and till now compiles and maintains the index. On July thirty first, 1964, at then hang seng index was first created and published. And stocks' total value and the base of 100 points of the index were set equivalent. After the establishment of the base value but prior to the publication of the index, the all-time low of the 58.61 points was reached on August thirty one, 1967. For the very first time, the highpoint of 10,000 point was passed by the Hang Seng index on December 10, 1993, and after 13 years passed the 20,000 point on December 28, 2006 and within 10 months the highpoint of the 30,000-point was passed on October 18, 2007.

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The highest milestone has been 31,958.41 points, which were achieved on October thirty, 2007 during trading and 31,638.22 points at closing. 30% loss was faced by the index from October thirty, 2007 to the March nine, 2008, when the index lost the 9,426 points. For the very first time in more or less a year, on September 5, the index fell as low as 19,708.39, later closing at the 19,933.28. Further falling down to over 50% less of the all-time high, the index sealed at the15, 431.73 on October 8, 2008, this was the lowermost finishing value in the two years. Further down to approximately two-thirds from its all-time peak and the index came down to the 10,676.29 points on October 27, 2008, but again the twenty thousand-points milestone was passed by the stocks on twenty forth of July 2009 by the 20,063.93 points.

Hang Seng Sectors Weighting Finance                           47.16% Utilities                               5.58% Properties                         10.39% Commerce & Industry       36.86%

This offer a broad standard of the performance of the Hong Kong stock market, and Hang Seng the Composite Index Series was commenced on October three, 2001. This Index comprises of the geographical series and the industry series containing the topmost 200 listed companies available in the terms of market capitalization. 97% of the whole capitalization of the stocks in Hong Kong is accounted for the market capitalization of some of these companies. The Independent Advisory Committee was established by the HIS Services that guarantee justice in its deeds and to put forth recommendations on the issue of pertaining to index. On the quarterly basis, the component stocks of HIS are reviewed by the Committee and changes are projected. .


The turnover of the total stock market and by how much is covered by its market capitalization gives a study of the representation of the HIS. Nearly at 70% of the total market value, the collective market value of the HSI component stocks is well preserved. This is a positive sign for the coverage ratio as compared to the major overseas stock indices.

Hang Seng Index listed standards and requirements:

• The index attempts to only include free floating shares so the calculation excludes the non-freely tradable companies capital. This is to insure available trading liquidity for index investments.

• On a quarterly basis a cap factor (CF) is calculated to prevent any individual stock from having a weighting factor that is greater than established acceptable cap levels.

• Shares held by certain idividual entities that own greater than 5 percent of the shares are classified as non-freefloat and are not included in the index calculation. Shareholders that are either mutual funds or investment companies, certain custodians and trustees are not included in the 5 percent exclusion.

• An index company will be removed from the index if its shares are suspended from trading for a period of one month.

There are 45 listed companies in the Hang Seng Index