The group of Australian companies below are the 50 largest companies listed on the Australian Stock Exchange. Commonly known as the ASX 50 Index, it is a large capitalization index similar to the ASX20 and ASX200 Shares Index. For the largest ASX indices such as the ASX 200 and ASX all ordinary index, it includes the companies that are included in the prior smaller index such as the 50 largest Australian companies listed below.
A capitalization index means the the weight of each company makeup the index is proportional to the total value of all 50 companies. The larger the company, the larger its weight in the index.
The list is broken down by market capitalization and sector. The price of the shares change day to day, the market cap figure is rounded to the nearest hundred million and should be used as an indicative ranking order only. The index is rebalanced quarterly.
The minimum size for companies to be included in the ASX 50 is estimated to be $5.0 billion equity value determined by its share price times total shares on issue and exclude the total debt outstanding. The market capitalization is the key factor factor that ultimately determine if a company is included in the index.
However there are a number of secondary hurdles each company must pass including daily trading volume as proxy for market liquidity and total shares outstanding is adjusted for the free float factor. This is portion of the shares outstanding that is not locked up, tightly held by private investors and are freely traded.
Long Term Index Investing
Index funds track the returns of market indices. Long term passive investors can use index funds to piggy back the market performance.
The return of the ASX 200 matches to a large extent to the 50 index because while ASX 200 include 200 companies, both index share the 50 largest position in the index.
Lets face it, it is hard for individual investors to even keep track of a top 10 shares list let alone a full diversified portfolio. Index funds have the advantage of providing a low cost and convenient option for long term investors. The goal of these funds is to capture the market returns and perfect for those that want a set and forget option for long term investing without the hassle of high fees or try to time the market.
ASX 50 Index Fund
S&P ASX 50 ETF (ASX SYF) is an ASX listed index tracker. The goal is not outperform the index but replicate the the returns of the index. The fund investments in the listed companies will be exactly in proportion to their make up in the index it self. There are a number of advantages of using ETF including a powerful way of achieving market returns if the investor does not have the skill set or time to mange capital themselves.
It is extremely cost effective where the annual cost of SYF ETF is only 0.286% per year and it bypass the need for additional layer of financial adviser fees. Most importantly, academic research shows that more than half of fund managers under perform their benchmark after taking into account of fees charged.
Periodically, the index is rebalanced as companies value changes overtime. Standard and Poors’ set a quarterly rebalancing frequency in which when the value of companies has increased to the point it is one of the 50 largest listed companies, then it is included. Vice versa for company that has lost value over the quarter below the minimum threshold.
As the index is made up of the top 50 stocks ASX listed. The exact market capitalization is based on the size of the 50th largest company.
In the most recent index rebalance, Crown was removed in the March 2016 rebalancing and replaced with Qantas and late 2016, Treasury Wine Estates introduced and replaced Asciano.
ASX 50 Index Components
|Name||ASX Ticker||Market Cap||Sector|
|Commonwealth Bank of Australia||CBA||$140,600 Mil||Financial|
|BHP Billiton||BHP||$132,500 Mil||Resources|
|Westpac Banking Corp||WBC||$106,900 Mil||Financial|
|Rio Tinto Limited||RIO||$100,100 Mil||Resources|
|Australia and New Zealand Banking Group||ANZ||$86,300 Mil||Financial|
|National Australia Bank||NAB||$80,500 Mil||Financial|
|Telstra Corporation||TLS||$61,100 Mil||Telecommunication|
|CSL Limited||CSL||$52,200 Mil||Industrial|
|Wesfarmers Ltd||WES||$47,000 Mil||Conglomorate|
|Woolworths||WOW||$31,400 Mil||Consumer Staple|
|Macquarie Group Ltd||MQG||$28,900 Mil||Financial|
|Woodside Petroleum||WPL||$26,900 Mil||Energy|
|Scentre Group||SCG||$23,400 Mil||Real Estate|
|Transurban Group||TCL||$21,200 Mil||Infrastructure|
|Brambles Limited||BXB||$19,500 Mil||Industrial|
|Westfield Corp Ltd||WFD||$18,500 Mil||Real Estate|
|Suncorp Group Ltd||SUN||$17,200 Mil||Financial|
|Amcor Limited||AMC||$17,000 Mil||Industrial|
|QBE Insurance Group Ltd||QBE||$16,900 Mil||Insurance|
|Newcrest Mining Limited||NCM||$16,600 Mil||Resources|
|AGL Energy Ltd||AGL||$15,300 Mil||Energy|
|AMP Limited||AMP||$14,900 Mil||Insurance|
|Insurance Australia Group Ltd||IAG||$14,100 Mil||Insurance|
|Ramsay Health Care Limited||RHC||$13,900 Mil||Healthcare|
|Sydney Airport Holdings Ltd||SYD||$13,600 Mil||Infrastructure|
|Origin Energy||ORG||$12,800 Mil||Energy|
|Goodman Group||GMG||$12,200 Mil||Real Estate|
|Vicinity Centres Re Ltd||VCX||$11,300 Mil||Real Estate|
|Oil Search Limited||OSH||$10,800 Mil||Energy|
|Stockland Corporation Ltd||SGP||$10,300 Mil||Real Estate|
|Aurizon Holdings Ltd||AZJ||$10,200 Mil||Transport|
|APA Group||APA||$9,600 Mil||Infrastructure|
|ASX Ltd||ASX||$9,500 Mil||Financial|
|James Hardie Industries plc||JHX||$9,000 Mil||Industrial|
|Sonic Healthcare Limited||SHL||$8,700 Mil||Healthcare|
|DEXUS Property Group||DXS||$8,600 Mil||Real Estate|
|GPT Group||GPT||$8,500 Mil||Real Estate|
|Santos Ltd||STO||$8,300 Mil||Energy|
|Treasury Wine Estates Ltd||TWE||$8,200 Mil||Consumer Discretionary|
|Lend Lease Group||LLC||$8,100 Mil||Real Estate|
|Caltex Australia Limited||CTX||$7,800 Mil||Energy|
|Coca-Cola Amatil Ltd||CCL||$7,600 Mil||Consumer Discretionary|
|Medibank Private Ltd||MPL||$7,400 Mil||Healthcare|
|Mirvac Group||MGR||$7,400 Mil||Real Estate|
|Orica Ltd||ORI||$7,000 Mil||Industrial|
|Computershare Limited||CPU||$6,900 Mil||Industrial|
|Qantas Airways Limited||QAN||$6,400 Mil||Consumer Discretionary|
|Incitec Pivot Ltd||IPL||$5,900 Mil||Industrial|
|SEEK Limited||SEK||$5,100 Mil||Transport|
We have classified the companies on the ASX 50 list by sector. As it can be seen below, the campanies in the top 50 ASX index is dominated by resources, financials and real estate industries.
ASX 50 Sector Weights
The sector composure is similar to sector breakdown of the broader ASX 200 index. Financials and resources make up around 50% of the total value in the index. This can be considered highly concentrated on an individual stock basis as the financials are dominated by the big 4 banks.
Real estate is one of the largest sub sector within the financial component of the index. In August 2016, the REIT sector will be broken out of the broader financial segment.
The Australia Stock Exchange is known to be the preferred listing option for the mining sector. Even with hundreds of mining companies, the market capitalization of BHP and RIO dominates the resources sector.