S&P U.S. Indices Methodology Update And Constituent Additions

(RTTNews) - S&P Dow Jones Indices, a part of McGraw Hill Financial (MHFI), announced changes to the S&P U.S. Indices methodology and additions to the S&P 100, S&P 500, S&P MidCap 400 and S&P SmallCap 600.

As previously announced, S&P Dow Jones Indices will include all publicly listed multiple share class lines separately in its float market cap (FMC) weighted indices subject to liquidity and float criteria currently in place for each index. This change will be effective after the close of trading on Friday, September 18 to coincide with the September quarterly rebalance.

Index membership eligibility for a company with multiple share class lines will continue to be based on the total market capitalization of the company including all publicly listed and unlisted share class lines. The decision to include each publicly listed line in an index will be evaluated line by line; the weight of each line will only reflect its own float, not the combined float of all company lines.

There will no longer be consolidated lines in S&P U.S. FMC indices. It is possible that one listed share class line may be included in an index while a second listed share class line of the same company is excluded. Unlisted share class lines will not be combined with any other listed share class lines, but unlisted share class lines will be included when determining a company's total market capitalization.

For S&P 1500 constituents, listed share class lines not currently in the index would need to pass current liquidity and float criteria, but not market capitalization criteria (which is only considered at the company level). Listed share class line deletions will be at the discretion of the governing Index committee and as a result a listed share class may continue to be included in the index even if it subsequently fails to meet addition criteria. Alternatively weighted indices that follow the composition of an S&P Dow Jones FMC index will continue to utilize the same composition as the parent index.

There are currently four companies with two or more publicly listed share class lines in the S&P 100. One of these companies, Google Inc. (GOOG, GOOGL) is already represented by two share class lines in the index.

After the methodology change, current S&P 100 index constituents Comcast Corp. (CMCSA,CMCSK), and Twenty-First Century Fox Inc. (FOXA,FOX) will each have an additional listed share class line added to the S&P 100.

Under current methodology, there are 100 companies and 101 trading lines in the index. Effective with the methodology change, there will be 100 companies and 103 trading lines in the index.

Due to turnover and liquidity concerns, S&P 100 constituent Berkshire Hathaway Inc. (BRK.B) will be an exception to this rule. S&P Dow Jones Indices will continue to consolidate the share count for this company under the B share class line.

There are currently thirteen companies with two or more publicly listed share class lines in the S&P 500. Two of these companies, Discovery Communications Inc. (DISCA,DISCK) and Google Inc. (GOOG, GOOGL) are already represented by two share class lines each in the index.

After the methodology change, current S&P 500 index constituents Comcast Corp. (CMCSA,CMCSK), Twenty-First Century Fox Inc. (FOXA,FOX) and News Corp. (NWSA,NWS) will each have an additional listed share class line added to the S&P 500.

Under current methodology, there are 500 companies and 502 trading lines in the index. Effective with the methodology change, there will be 500 companies and 505 trading lines in the index.

Due to turnover and liquidity concerns, S&P 500 constituent Berkshire Hathaway Inc. (BRK.B) will be an exception to this rule.

There are currently seven companies with two or more publicly listed share class lines in the S&P MidCap 400. No additional listed share class lines meet the necessary liquidity and float thresholds for index inclusion.

There are currently eight companies with two or more publicly listed share class lines in the S&P SmallCap 600. S&P SmallCap 600 index constituent Central Garden & Pet Inc. (CENTA,CENT) will have an additional listed share class line added to the S&P SmallCap 600.