The Hang Seng Indexes Company announced that it will revise the methodology of the Hang Seng HK-US Tech Index by adding SpaceX to the existing “Magnificent 7” (M7) US stocks, increasing the total number of US constituents to 8.
The weighting of the 8 US-listed constituents will be readjusted to equal weighting after the close of SpaceX’s 7th trading day. The addition of the new constituent and the updated constituent weights will take effect on SpaceX’s 11th trading day.
SpaceX is expected to debut on June 12, with a market forecast valuation between US$1.75 trillion (HK$13.65 trillion) and US$2 trillion.
According to the index calculation rules, the combined weight of US constituents will be capped at 35 percent. The change will take effect once SpaceX confirms its listing.
The ETF currently tracking the Hang Seng HK-US Tech Index is the CSOP Hang Seng HK-US TECH ETF (3442), which has assets under management of HK$634 million.
The Hang Seng HK-US Tech Index covers constituent stocks of the Hang Seng Tech Index that are eligible under the Stock Connect scheme, as well as the Nasdaq-listed Magnificent 7 stocks. With the addition of SpaceX, it will now become “M7+1”.
The current top 10 heaviest stocks in the index are: Semiconductor Manufacturing International Corporation (0981), Meituan (3690), Amazon, Alphabet, BYD (1211), Xiaomi (1810), Alibaba (9988), Nvidia, Apple, and Tencent (0700).
As of the end of April, the index has recorded a year to date return of -7.27 percent, compared with a decline of 11.7 percent for the Hang Seng Tech Index over the same period.
