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Indices to move to free float

Thursday 16th October 2003

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The New Zealand Exchange has finalised the makeup and structure of the remaining NZSX indices, the NZSX 10, the NZSX MidCap, the NZSX SCI (Small Cap) and the NZSX All.

From 1 January 2004, all NZSX indices will be calculated on a free float basis.

"The strategic review held earlier this year identified the need to reassess all the indices and the introduction of the NZSX 50 as our benchmark index was the first step in that process," NZX indices manager Guy Fisher says.

"The changes announced today mark the completion of that review and will ensure that all of our indices are treated consistently and transparently."

The free float based weighting methodology is designed to improve the investibility of the indices and to encourage a better reflection of market performance. NZX will amend the rules governing weighting changes and the treatment of new issues. Details of these rule changes, along with information on the possible composition of the indices and the structure of the finalised index family, have been posted on our website at http://www.nzx.com/nzxmarket/indices/index_review.

NZX will continue to calculate the NZSX 40 and NZSX 30 indices, however these will not form part of our core index family and will not be included from 1 January 2004 in the public broadcast feed. These indices will be available on a subscription basis only, from NZX Data.

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