It was almost three decades ago that the S & P/ASX 200 Index launched, with Telstra and News Corporation as its single biggest constituents. Over the years, it has tracked the rise and fall of some of the country’s best known companies, from HIH Insurance to Babcock & Brown and AMP.
But the benchmark is not perfect. Investors have long worried, in particular, about its concentration. The big four banks make up roughly a quarter of the ASX 200. BHP and Rio Tinto alone another 13 per cent. In fact, the ten most valuable stocks on the Australian sharemarket account for half of the index , crowding out industries outside financial services and mining.
Gift articles to anyone you choose each month when you subscribe.
