Yomiuri 333 Stock Index Raises Investor Expectations in Japan; Equal Weighting To Provide New Perspective

The Yomiuri Shimbun

18:59 JST, November 28, 2024

The government and investors have expressed their high hopes for the Yomiuri Stock Index (Yomiuri 333), saying it will expand people’s investment options.

The Yomiuri Shimbun announced Thursday that it will establish the Yomiuri 333 in March next year to indicate the price movements in Japan’s stock market.

By providing a new benchmark for the Japanese economy, the nation’s leading daily newspaper hopes the index will encourage domestic and foreign investment in Japanese companies, promote corporate growth and return its fruits to the people.

The Wall Street Journal reported Wednesday (Thursday in Japan) that “[The] Yomiuri Shimbun, Japan’s largest newspaper by print circulation, said it plans to introduce a new stock index next March that it sees as an alternative to the widely followed Nikkei 225 index and Japan Exchange Group’s Topix index.”

Media outlets in Japan also immediately reported the news online.

The Yomiuri Stock Index will be composed of 333 listed companies that represent Japan. The key feature of the new index is that it will use an equal-weighting method in calculating the index, which will equally reflect the price movements of the 333 companies.

The Nikkei Stock Average (Nikkei 225) and the Tokyo Stock Price Index (TOPIX) tend to be affected by the price movements of higher-priced stocks and companies with large market capitalization.

“The development of a new stock index, leading to the provision of new investment products, will expand the choices for investing in Japanese companies,” Chief Cabinet Secretary Yoshimasa Hayashi said at a press conference Thursday. “It is desirable in terms of helping the people to build their assets,” he said.

“The index is well-balanced, and will make it easier to understand the situation in the stock market,” one individual investor said.

“[With this index,] even companies with a small market capitalization that are making good efforts will be more likely to attract attention. If financial products linked [to this index] are created, investors will be able to diversify their investments with a new perspective,” said Yukino Yamada of Daiwa Securities Co.