Entering ASX 300 early March?, page-7

Haven't had time to work out where MGX sits, but a couple of the key factors that will determine whether MGX makes the ASX 300 index:

1. Market Capitalisation. The S&P/ASX indices only include securities that are considered to be institutionally investable, and market capitalization is a key criterion for stock selection. Stocks are included if they are large enough to meet the minimum ranking requirements for the representative indices within the Australian market.The market capitalization criterion for stock inclusion is based upon the daily average market capitalization of a security over the last six months. The stock price history (last six months), latest available shares on issue and the Investable Weight Factor (IWF) are the relevant variables for the calculation. The IWF is a variable that is primarily used to determine the available float of a security for ASX listed securities.

2. Liquidity. Only stocks that are regularly traded are eligible for inclusion in any S&P/ASX index. A stock’s liquidity is measured relative to its peers. Relative Liquidity is calculated as follows:

Relative Liquidity = Stock Median Liquidity / Market Liquidity

where:
• Stock Median Liquidity is the median daily value traded for each stock divided by the average float/index weight-adjusted market capitalization for the previous six months and;
• Market Liquidity is determined using the market capitalization weighted average of the stock median liquidities of the 500 companies in the All Ordinaries index.

We will know shortly for MGX.