FTSE Vietnam Index Series
Ground Rules Change

25 November 2009


In December FTSE will resume making constituent changes to the FTSE Vietnam Index Series. The Index Series will also incorporate changes in methodology. The following highlights the main changes that will be incorporated in the methodology:

The FTSE Vietnam Index Series will be reviewed on a quarterly basis in March, June, September and December, and any changes implemented after the close of trading on the third Friday of the review month (see Ground Rule 5.1).

A new liquidity rule will be applied to the Index Series that looks at the relative liquidity of the underlying index to determine whether securities are eligible for inclusion or exclusion. For example, securities that do not turnover at least 20% of the FTSE Vietnam All-Share Index 3-month average daily traded value are not eligible for inclusion in the FTSE Vietnam All-Share Index. The FTSE Vietnam Index will follow the same liquidity process as the All-Share, but have a more stringent liquidity threshold applied (see Ground Rule 5.4).

For the FTSE Vietnam index existing index constituents that fail the liquidity rule will not be eligible for inclusion until passing the liquidity rule for two consecutive reviews (see Ground Rule 5.4.3).

For the FTSE Vietnam Index a new size rule will be applied that looks at the relative size of the underlying index to determine whether securities are eligible for inclusion or exclusion. For example, a security will be inserted at the periodic review if its investable market capitalisation is larger than 1% of the FTSE Vietnam Index market capitalisation prior to any changes at the periodic review (see Ground Rule 5.8).

There will no longer be a fast entry rule, new issues will be added at the next index quarterly review providing that they have traded for 3-months and meet the index eligibility requirements (see Ground Rule 6.1).

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