NEW YORK, Sept. 27, 2005 – Beginning Oct. 3, 2005, the Rule 80A restrictions on index-arbitrage trading in NYSE listed component stocks of the S&P 500 IndexSM will be based on the NYSE Composite Index or NYA. The Securities and Exchange Commission approved amendments to the rule, which revise the basis for calculating the Rule 80A trading collars to the NYA, replacing the Dow Jones Industrial Average.
“The NYSE Composite Index is the best barometer for long-term trends and intra-day market performance as it reflects the breadth and quality of stocks listed on the NYSE,” said NYSE senior vice president of Competitive Position, Robert McSweeney. “With the index recalibration and the introduction of an NYSE Composite-based exchange-traded fund, the NYA is the natural benchmark for any policies intended to dampen volatility and increase investor confidence in our market.”
The amended Rule 80A will now base the trading collars on a 2 percent movement in the average closing value of the NYA. The NYSE Composite Index is designed to measure the performance of all common stocks and ADRs listed on the Exchange, representing the quality, stability and outstanding performance of the entire NYSE list. It also closely reflects the broader market, representing 77% of the total market capitalization of all publicly traded companies in the U.S. and 64% of the world’s total market capitalization.
Recalculated to a base value of 5,000 on Dec. 31, 2002, the NYA closed at a record high of 7663.82 on Sept. 9, 2005 and has outperformed all major indexes over the past 1 and 5 years and to date in 2005. The NYA includes many of the world’s best companies and most widely held securities, giving investors the most accurate depiction of the performance of the NYSE market.