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The ASX200 index, or S&P/ASX200 is widely used as the benchmark index to assess the performance of the Australian economy. It is managed and maintained by Standard & Poor’s, and tracks the performance of 200 companies whose stocks are listed on the Australian Securities Exchange.
This page will take you through a brief history of the ASX200, detail how the stocks it tracks are selected, and let you know the different ways you can invest in the index.
The ASX200 has been calculated since the 31st March 2000, on which date it started with a value of 3,133.3. This level was chosen as it was the level of the broader All Ordinaries index (AOI), the oldest index in Australia which tracks the performance of the top 500 stocks (measured by market capitalisation) traded on the Australian Securities Exchange.
Today, different companies use different ticker symbols to refer to the ASX 200, with Bloomberg using AS51, and Yahoo! Finance and CNBC using ^AXJO and .AXJO respectively.
In terms of performance over time, the ASX200 was hit hard by the 2007-08 financial crash, which saw it plummet from the high 6,000s in October 2007 to below 4,000 by February 2009. The Australian economy rallied from this point and then saw good growth between the 2010s, with the ASX200 reaching its all-time-high of 7,162.50 on the 20th February 2020. This growth was then swiftly curtailed by the coronavirus pandemic and the index had fallen to 4,546.00 by the 23rd March.
The ASX200 is composed of the 200 largest stocks traded on the Australian Securities Exchange, and is a float-adjusted capitalisation-weighted index. The stocks tracked by the ASX200 make up over 80% of Australia’s sharemarket capitalisation, and include companies such as National Australia Bank, ALS Limited, and Technology One.
In order to invest in an index, you need to use a financial instrument designed to track its performance over time. The two most common ways of doing this are ETFs (exchange-traded funds) and mutual funds. With an ASX200 ETF you’ll have a diversified investment that follows the ASX200 index, and you can also trade your investment at any time during trading hours on an exchange. A mutual fund gives you a similar form of diversification, but less flexibility as they can only be bought or sold at the end of the day’s trading.