The Taiwan Capitalization Weighted Stock Index (TAIEX) is the benchmark index for the Taiwan Stock Exchange (TWSE) and serves as a barometer of the overall performance of the Taiwanese stock market. The TAIEX is a market capitalization-weighted index, meaning that the weight of each constituent is determined by its market capitalization relative to the total market capitalization of all the constituents in the index.
The TAIEX includes all the listed stocks on the main board of the Taiwan Stock Exchange, covering various sectors of the economy, such as technology, finance, manufacturing, and service industries. As a result, the TAIEX provides a comprehensive view of the overall health and trends in the Taiwanese stock market.
The index constituents are reviewed and adjusted periodically to ensure that the TAIEX remains representative of the market. During the review process, companies may be added to or removed from the index based on changes in their market capitalization, liquidity, or other factors.
Investors and financial professionals use the TAIEX for a variety of purposes, including:
Benchmarking: The index serves as a performance benchmark for portfolio managers and investors to compare their investment returns against the broader market.
Passive investment: Index-tracking funds and Exchange-Traded Funds (ETFs) use the TAIEX as a basis for their investment strategies, aiming to replicate the performance of the index by holding the same stocks in the same proportions.
Market analysis: The TAIEX provides insights into the overall health of the Taiwanese stock market and can help investors identify trends, risks, and opportunities in the market.
Portfolio diversification: Investors can use the TAIEX as a tool to diversify their portfolios by gaining exposure to a broad range of companies and sectors within the Taiwanese equity market.
It is important to note that investing in stocks or index-tracking products involves risks, and investors should carefully consider their investment objectives, risk tolerance, and the costs associated with investing before making investment decisions.
Below is a list of Taiwan Capitalization Weighted Stock Index (TAIEX) components:
TAIWAN SEMICONDUCTOR MANUFACTURING
HON HAI PRECISION IND.
LARGAN PRECISION Opto
CATHAY FINANCIAL HOLDINGS
FORMOSA CHEMICALS & FIBRE
NAN YA PLASTICS
FUBON FINANCIAL Holding