Shenzhen Stock Exchange And Shenzhen Securities Information Co., Ltd.: The First Series of Performance Indices Make their Debut, Guiding Long-term Value Investment

19/11/2012

Shenzhen Stock Exchange and Shenzhen Securities Information Co., Ltd. jointly announced on November 19, 2012 to issue a series of performance indices, which encompass SZSE Performance Index(Abbreviation: SZSE Performance, Code: 399655), SZSE 100 Performance Weighted Index(Abbreviation: 100 Performance WT, Code: 399656), SZSE 300 Performance Weighted Index(Abbreviation: 300 Performance WT, Code: 399657), SME Performance Weighted Index(Abbreviation: SME Performance WT, Code: 399658), and CNINFO Performance Index(Abbreviation: Performance Index, Code: 399398).

Being the first of their kind in the country, the newly launched series of performance indices fill in the blank record of performance indices in domestic capital market. By introducing relative indicators in measuring the enterprises’ performance, this series of indices are a breakthrough comparing with the previous financial weighted indices, most of which apply absolute indicators. Consequently, they are conductive to guiding the public companies in improving their long-term operational performance, contributive to the development of value investment philosophy in the market, and facilitate the sound development of capital market.

The performance series indices assess the operational performance of public companies in terms of such three relative indicators as ROE, the cash return on total assets ratio and cash dividend rate of net asset. In this respect, the top 100 public companies are selected from Shenzhen Market and A-share markets to constitute the samples for SZSE performance Index, and CNINFO Performance Index respectively. In this way, enterprises of different scales become comparable in terms of profitability, earning quality and investment return. The performance series indices adopt new performance stratification weighted method and endow relatively higher weights to the stocks with higher assessment in performance. 100 Performance WT, 300 Performance WT and SME Performance WT adopt the sample stocks of SZSE 100, SZSE 300 and SME Index respectively as samples, which are calculated with performance stratification weighted method.

As the data shows, the cumulative gains of SZSE Performance Index and CNINFO Performance Index are respectively 269% and 287% since their base date, while those of SZSE A share Index and CNINFO A share Index are respectively 118% and 131%. 100 Performance WT, 300 Performance WT and SME Performance WT have respectively 69%, 73% and 62% exceeding cumulative gains comparing with those of SZSE 100, SZSE 300, and SME Index.

More material on the indices can be found on the website of Shenzhen Stock Exchange (www.szse.cn) and the website of CNINFO Index(index.cninfo.com.cn).