KUALA LUMPUR: The expansion of the FTSE Bursa Malaysia KLCI (FBM KLCI) from 30 to 50 constituents is expected to provide a more accurate representation of Malaysia's domestic economy.
The impact on the weightings of existing constituents is expected to be manageable, according to AHAM Asset Management Bhd (AHAM Capital).
Its deputy head of equity (Malaysia), David Loh, said the expansion would provide broader coverage of the domestic market, which has long been represented by a relatively small number of companies, while allowing the performance of more sectors, particularly technology, to be reflected in the benchmark index.
"For the longest time, the biggest comment about the Malaysian index is that it is very much in the old economy sector. A lot of technology stocks have done well in the past, but their performance was not captured in the FBM KLCI because they were not in there.
