Tadawul updates indices methodology, applies ‘fast entry’ rule

The Saudi Stock Exchange (Tadawul) updated its indices methodology for the development and management of Tadawul equity indices.

It reviewed free float shares calculation methodology, fast inclusion to Tadawul main market index (TASI), capped indices calculation and maintenance, the exchange said in a statement.

The free float shares calculation methodology has been revised against non-free float shares owned by a government entity where ownership is 5% and more, restricted shares, companies share buy-back, controlling ownerships, and shares held by members of the board of directors.

Tadawul applied a new “fast entry” rule, under which shares of significantly massive IPOs join TASI at the close of the fifth trading day. 

In addition, an index capping was applied for TASI with a threshold of 15%.

The fast entry rule is effective immediately. Other changes will come into effect by the end of Q4 2019, in alignment with the quarterly indices maintenance.