January 19, 2022

JSE Investing

Investing in the JSE

 

The JSE was established in 1887 during the gold rush and went electronic in 1990 only.

 

What is an Index?

You will often hear people talk about the ALSI, FINI & RESI. What the hell are these? They are indexes.

 

An index is a sample of stocks that tracks a specific number of shares.

 

Examples of common Indexes on the JSE

  • ALSI
  • ALSI 40
  • All Gold
  • RESI
  • FINI
  • INDI

Whenever you see a number after the index name, that is the number of shares in the index eg RESI 10, it contains 10 stocks.

ALSI

The JSE All-Share index is the main index of the local share market. It comprises 62 stocks in total. It is made of the top 40 shares by market capitalization and another 22 shares across all industries and sectors

 

ALSI 40

These are the top 40 shares on the JSE by market capitalization.

 

Companies selected for inclusion in the ALSI 40 Index are generally larger companies of sound financial standing having widely traded and marketable shares.

 

All gold index

A weighted average of all the companies that mine gold that are listed on the JSE.

 

Other indexes

There is also a resources index (RESI), financial index (FINI), and an industrial index (INDI):

  • The RESI is made up of resource shares e.g. BHP Billiton
  • The FINI includes shares such as banks. e.g. Standard Bank
  • The INDI is made up of industrial companies. e.g. Richemont

 

What is a SENS Announcement?

SENS is the JSE communication channel.

The only manner in which companies are allowed to communicate with shareholders is via the Stock Exchange News Service (SENS) process. SENS is channeled through authorized JSE Sponsors.

 

What is a Sponsor?

The JSE Sponsor is the middleman between the company & the JSE. No listed entities are allowed to communicate directly with the JSE

 

Example: Ascendis is the listed entity, but Questco communicates with the JSE via SENS. They sign the SENS.

 

Useful Resources to Research JSE Listed Companies

 

  1. https://www.jse.co.za/learn-how-to-invest
  2. https://sashares.co.za/
  3. Follow @JSE_SENS on Twitter
  4. Register a free account with https://sharedata.co.za