FTSE AIM All-Share Index

The FTSE AIM All-Share Index is the broadest index tracking the London Stock Exchange‘s (LSE) Alternative Investment Market (AIM). The index includes 1,029 companies on the LSE’s AIM segment, which is described as a “dedicated growth market for small and medium-sized companies.”1)Retrieved 20 May 2016 https://www.londonstockexchange.com/companies-and-advisors/aim/publications/documents/a-guide-to-aim.pdf

The companies listed on the index represent a total market capitalisation of £68 billion. According to LSE, the AIM market contains a wide range of businesses, including early stage and venture-capital backed companies in addition to more established companies seeking access to growth capital.2)Retrieved 20 May 2016 https://www.londonstockexchange.com/companies-and-advisors/aim/publications/documents/a-guide-to-aim.pdf

In addition to the FTSE AIM All-Share Index, the FTSE AIM Index Series also includes:

  • FTSE AIM UK 50 Index, representing largest 50 eligible UK companies
  • FTSE AIM 100 Index, representing the largest 100 eligible companies
  • FTSE AIM All-Share Supersector Indices, representing the performance of sectors within the AIM index3)Retrieved 20 May 2016 http://www.ftse.com/products/indices/aim

The largest market capitalisation of a company listed on the AIM index is £1.8 billion, and the average market capitalisation is £50 million. The average annual dividend yield of AIM index shares is 1.52%.4)Retrieved 20 May 2016 http://www.ftse.com/products/indices/aim

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History

FTSE indices trace their origins to the launch of the FT Actuaries Index in 1962, which tracked the performance of the broad UK Stock Market. FTSE, or Financial Times Stock Exchange Group, was established as a joint venture between the London Stock Exchange and the Financial Times in 1995.5)Retrieved 20 May 2016 http://www.ftse.com/Analytics/FactSheets/Home/DownloadSingleIssue?issueName=AIMSER

The FTSE indices are managed by FTSE Russell, which is wholly owned by London Stock Exchange Group. A series of FTSE indices were then created to track the performance of shares from standard and large-scale listings on the London exchange. This was followed by the creation of the Alternative Investment Market series indices, which track the performance of the growth segment of smaller companies.6)Retrieved 20 May 2016 http://www.ftse.com/Analytics/FactSheets/Home/DownloadSingleIssue?issueName=AIMSER

The AIM segment began operating in 1995 with only 10 companies, representing a total market capitalisation of £82 million. In the years since its launch, the segment has listed more than 3,500 companies, raising more than £90 billion in capital for participants. The AIM index currently includes companies headquartered in 24 countries and operating in more than 100.7)Retrieved 20 May 2016 http://www.ftse.com/Analytics/FactSheets/Home/DownloadSingleIssue?issueName=AIMSER

Companies listed on the AIM market may eventually grow and “graduate” to a listing on the more rigorous main market of the LSE. Since AIM’s inception, more than 100 companies have graduated to the main market.8)Retrieved 20 May 2016 http://www.ftse.com/Analytics/FactSheets/Home/DownloadSingleIssue?issueName=AIMSER

Composition

The top 10 listings on the FTSE AIM All-Share Index by market capitalisation are as follows:

  • ASOS (MCap £2.45 billion)
  • New Europe Property Investments plc (MCap £2.44 billion)
  • ABCAM (MCap £1.33 billion)
  • Hutchison China Meditech (MCap £1.22 billion)
  • James Halstead (MCap £913 million)
  • Dart Group plc (MCap £816 million)
  • Breedon Aggregates Ltd (MCap £774 million)
  • Newriver Retail Ltd (MCap £759 million)
  • Clinigen Group Plc (MCap £714 million)
  • Origin Enterprises Plc (MCap £710 million)

The AIM indices list companies from all 19 supersectors of the Industry Classification Benchmark (ICB), which includes (but is not limited to) healthcare, real estate, oil and gas, basic resources, industrial goods and services, retail, financial services and technology.

According to FTSE, the supersectors give investors a means to identify macroeconomic trading and investment opportunities, while also providing a foundation for tradable products. The top sectors represented on the AIM indices according to market capitalisation include:

  • Healthcare (MCap £6 billion)
  • Industrial goods and services (MCap £5 billion)
  • Financial services (MCap £4.3 billion)
  • Technology (MCap £4.2 billion)
  • Oil and gas (MCap) £2.6 billion9)Retrieved 20 May 2016 http://www.londonstockexchange.com/statistics/historic/aim/aim-statistics-archive-2016/feb-16.pdf

AIM Listing Rules

Unlike listings on the indices of the LSE’s main market, companies listed on the AIM do not need to meet these guidelines: minimum requirements for size (market capitalisation of a company); number of shares that a company must put into public hands in free float; minimum number of employees; amount of turnover or profitability; or any length of trading record.

Company shares, however, are required to be free from restrictions on transferability, and settlement arrangements for trades in the company’s shares must be in place. All trades in AIM securities must be able to be undertaken via electronic settlement.10)Retrieved 20 May 2016 http://www.hbcg.co.uk/wp-content/uploads/2013/07/The-Essential-AIM-Stock-Market-Guide-2013.pdf

Companies listed on AIM must appoint and retain a broker and nominated adviser (Nomad) at all times, and all are required to pay a joining fee to the London Stock Exchange. Additionally, companies that are regarded as “investing companies” are required to raise a minimum of £6 million in cash via equity fundraising at the time of admission to AIM.11)Retrieved 20 May 2016 http://www.hbcg.co.uk/wp-content/uploads/2013/07/The-Essential-AIM-Stock-Market-Guide-2013.pdf

This article contains general information and does not represent FXCM’s product offering or trading advice.

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