What is the Swiss Market Index?

Stock market price indices are very important indicators to follow for investments in any country. This is the case of the Swiss Market Index which is one of the best indices in Switzerland. What is the history of the SMI? What are the highlights of this index and what is its composition? Find out in this article.

What is the history of the Swiss Market Index (SMI)?

The swiss market index (SMI), also known as the Swiss 20, is the index used by the twenty (20) major companies of the Zurich stock exchange. Published for the first time on July 1, 1988, with 1500 points as its initial value, it has seen its shares vary over time (24 at the beginning, then changed to 29 in 1993 to end up at 20 in September 2010). Since its publication, it was not finally approved for use in the sale of financial assets in the EU until 2020.

What are the highlights and composition of this index?

Highlights

After its creation in 1988, the index was introduced to the stock exchange on June 30 of that year. It then moved to electronic trading on August 2, 1996.

Composition of the index

The value of the index is obtained by dividing the market capitalization of each stock by dividers. No component of the index has a value greater than 18% of the total value since September 2017. The stocks in the index, are multinational companies that have a major impact on the global market including Novartis AG and Holcim. Since its inception, many of these companies are still included, but have subsequently changed their names with the exception of Nestle Group. 

Others have been acquired by foreign capital while others have disappeared completely. The Swiss Market Index is one of the most important stock market indexes in the European market.