Methodology change | The North American MOC Marijuana Index | Effective Date 18 November 2020
Today, on the 12th of November 2020, Solactive announces the following changes to the methodology of the following indices (the ‘Affected Indices’):
|
NAME |
RIC |
ISIN |
|
The North American MOC Marijuana Index NTR |
.BAMMARN |
DE000SLA7WM7 |
|
The North American MOC Marijuana Index TR |
.BAMMART |
DE000SLA7WN5 |
Rationale for Methodology change
Due to the development in the Cannabis market Solactive AG has lowered the selection criteria in terms of Market Capitalization, Average Daily Value Traded and minimum Stock Price to adapt to the changing Cannabis market environment and strong volatility. Solactive AG wants to ensure that the universe of eligible companies does not fall below 15 Index Components, therefore additional steps of relaxation will be applied to the new thresholds mentioned in the proposed changes. More specifically, the new minimum thresholds of Market Capitalization and Average Daily Value Traded will be relaxed stepwise by 10% until 15 Index Components are selected. The relaxation would not apply to the minimum Stock Price to selection of 15 Index Components.
Changes to the Index Guideline
The wording in the Index Guideline is replaced as follows:
- Section 2.1
OLD WORDING:
2.1. SELECTION OF THE INDEX COMPONENTS
[…]
|
Inclusion criteria for companies not yet included in the Index |
Inclusion criteria for existing Index Components |
Maximum Weight for individual security |
|
Market Capitalization of at least CAD 400,000,000 Average Daily Value Traded (“ADV”) over the past 30 Trading Days up to and including the Selection Day of at least CAD 3,000,000 The security’s price must exceed CAD 3.00 |
Market Capitalization of at least CAD 360,000,000 Average Daily Value Traded (“ADV”) over the past 30 Trading Days up to and including the Selection Day of at least CAD 2,000,000 The security’s price must exceed CAD 3.00
|
10% |
|
Market Capitalization of at least CAD 200,000,000 Average Daily Value Traded (“ADV”) over the past 30 Trading Days up to and including the Selection Day of at least CAD 1,500,000 The security’s price must exceed CAD 1.00 |
Market Capitalization of at least CAD 180,000,000 Average Daily Value Traded (“ADV”) over the past 30 Trading Days up to and including the Selection Day of at least CAD 1,200,000 The security’s price must exceed CAD 1.00
|
6% |
NEW WORDING:
2.1. SELECTION OF THE INDEX COMPONENTS
[…]
|
|
1. |
2. |
3. |
|
|
Inclusion criteria for companies not yet included in the Index |
Inclusion criteria for existing Index Components |
Maximum Weight for individual security |
|
1. |
Market Capitalization of at least CAD 400,000,000 Average Daily Value Traded (“ADV”) over the past 90 Trading Days up to and including the Selection Day of at least CAD 3,000,000 The security’s price must exceed CAD 3.00 |
Market Capitalization of at least CAD 360,000,000 Average Daily Value Traded (“ADV”) over the past 90 Trading Days up to and including the Selection Day of at least CAD 2,000,000 The security’s price must exceed CAD 3.00
|
10% |
|
2.. |
Market Capitalization of at least CAD 140,000,000 Average Daily Value Traded (“ADV”) over the past 90 Trading Days up to and including the Selection Day of at least CAD 1,000,000 The security’s price must exceed CAD 0.80 |
Market Capitalization of at least CAD 120,000,000 Average Daily Value Traded (“ADV”) over the past 90 Trading Days up to and including the Selection Day of at least CAD 800,000 The security’s price must exceed CAD 0.80
|
6% |
If the application of selection criteria above results in less than 15 Index Components, the minimum criteria (Row 2.) will be relaxed stepwise by 10% until 15 Index Components are selected. The above-mentioned steps of relaxation do not apply for the security’s price.
The table below shows an illustration for the thresholds under a first step of relaxation (i.e. reducing Market Capitalization and ADV over 90 Days by 10%).
|
2. |
Market Capitalization of at least CAD 126,000,000 Average Daily Value Traded (“ADV”) over the past 90 Trading Days up to and including the Selection Day of at least CAD 900,000 The security’s price must exceed CAD 0.80 |
Market Capitalization of at least CAD 108,000,000 Average Daily Value Traded (“ADV”) over the past 90 Trading Days up to and including the Selection Day of at least CAD 720,000 The security’s price must exceed CAD 0.80
|
6% |
Defined terms used in this announcement, but not defined herein, have the meaning assigned to them in the respective index guideline of the Affected Indices.