The Tokyo Stock Exchange is set to significantly revamp its Topix index, reducing the number of constituent stocks by around 40 percent. The goal is to streamline the benchmark to below 1,000 stocks from the current 1,600, aiming to attract more investment. Starting October 30, the weighting of 683 selected stocks will be adjusted quarterly, while 35 new stocks, including McDonald's Holdings Co. (Japan) and Toei Animation Co., will be added.
Stocks that fail to meet the criteria during a reassessment in October 2027 will be fully removed by the end of July 2028. The composition of the index will consider factors such as market capitalization and trading volume. The Topix index originally included all stocks listed on the First Section of the Tokyo Stock Exchange but was reclassified following a market reorganization in 2022.
The constituent stocks will undergo annual reviews and replacements starting from October 2028. This revamp is part of a broader effort by Japan Exchange Group Inc. to modernize the Topix index and enhance its appeal to investors.