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Thanks Jerry, message sent.
Spratt, if you go on to their website and click on the contact button you should bring up a box to send messages. Quite simple.
Can someone provide the email address to query how they plan to resolve this error?, Hydro, Jerry?..can do any arm if more people take them to task over it. Appreciated
Harry - click on latest review - under documents on the right, you need to sign up and its free.
https://www.mvis-indices.com/indices/hard-asset/mvis-global-junior-gold-miners/components
Where can I find the list of additions to MVIS?
I had a look at the Uk companies (POG, Hocinshield and Highland Gold) + the new additions.
https://markets.businessinsider.com/stocks/highland_gold_mining-stock
This website provides an indication of the free float, it wont be exact, but hopefully a reasonable estimate.
Broadly speaking the free float allocation in the MVIS index seems to be reasonable for these companies. I think the error could be isolated to GGP - at least on this index.
Hi, Jerry. They have no good options here. My guess is Legal is going to tell them to go with what they've announced, rather than redo all their indices at the last minute, and fix it in December.
"Will they want that?" Of course not, but neither do they want to fix just one index. Nor do they want to create massive upheaval by changing everything last minute. Doing so would require major announcements of "we got everything wrong on UK shares for years." LOL. They'll probably just tell you, "We are looking closely at this and will consider changing what we are doing at the next reset." And then at the next reset they'll do it without any announcement.
Morning TmT. Nothing from Frankfurt overnight. My feeling is that they wouldnt want to scrap the entry for tomorrow, so they will either do it right with the bigger weighting (and adjust all the other weightings accordingly) or they will just add the other billion or so at the end of Nov decision which will be announced early Dec. But markets can be thin in December and the index will be wrong for 3 months. Will they want to do that?
Thanks for that @TMT. I'd prefer the correction to come in December anyway. It's better for the share price in the long run (IMHO). Who'd want to be out of this come December!
Worth remembering, from the first page of the MVIS Index Guide:
"MV Index Solutions GmbH (the “Index Owner”) makes no warranties or representations as to the accuracy and/or completeness of the Indices and does not guarantee the results obtained by persons using the Indices in connection with trading funds or securities. The Index Owner makes no representations regarding the advisability of investing in any fund or security.
The Index Owner reserves the right to update the rules in this Index Guide at any time. The Index Owner also reserves the right to make, in exceptional cases or in temporary situations, exceptions to the rules in this Index Guide."
To be blunt, they are saying, "we can do whatever we want and you will live with it."
Which means the likelihood of them fixing this now is virtually nil. The change will happen in December.
And I checked a UK share in another one of their indices and it looks like it has the same problem, LOL.
So, £22 million buy this weekend, and another probably even bigger in December, if our SP stays high.
@Jerry, got you. But I was talking about, if they don't fix their index weights now, what the size of the December buy will be in pounds. That will be affected by the SP at the end of November.
So unless they fix it now, if we keep our SP to 30/11 they'll be buying about £35 million. If our SP doubles by then if Scally hits big, they'd buy about £70 million.
But yes, the number of shares would be variable depending on the price on the day they buy.
Bang on Jerry
TmT. The weighting was established last week based on end August valuation. That is set in stone so the rising price reduces the number of shares to be bought (assuming that everything else stays the same). That we know I think and is broadly understood. The increase in buying caused by their errors will be based on a higher correct weighting but will again be fewer shares caused by the rising share price but will obviously be a lot more than the initial estimate.
So what I am saying is that a rising share price causes the weighting to increase but doesn’t affect the number of shares needed to be bought because the weighting is increased by the value of the shares which is a function of the share price.
If this is too esoteric and dull for others we can continue this elsewhere!
I am still trying to get my head around this Hydro. I am sure it’s patently obvious and it seems it is that this will have a positive effect now or in December . But can somebody please explain this to me in very simple terms ?
@ hydro. Your expertise is second to none. We all thank you for sharing it, along with some of the other top guys on here. It’s brilliant.
Really, Jerry? Isn't the weight based on free float MCAP, which is free float shares times price? I've been wrong more than once on this GDXJ thing but I thought that was nailed on, it used the end of August SP to determine the MCAP, and in December it will use end of November SP.
I'll look at it in the morning, I'm in a brutal work phase and it was another long day for me.
If it goes to the financial equivalent of VAR, they will decide it is a clear and obvious error, overturn the decision....
...and award a penalty to Liverpool.
Mushy it sounds like she should manage some of ours.....
TmT. One thing though, and it’s a bit late for me to get my head round... you might want to have a re think about the weighting increase caused by the sp rise causing more buying in December, cos I don’t think it will. The increase in free float will definitely add to shares bought though.
Yes Jerry, she does. Picked by moi I might add. It has just broken even after eighteen months haha.
Mushy it sounds like lady mush is one smart cookie. Does she have her own portfolio?!
Take note 88p pre year end
Guys.........please!!!! Stop getting overly exited........and research.
TmT, JS,
Thank you - all very astute and well reasoned.
Appreciate your time to reply and considered responses.
Brilliant, Jerry, thanks for your work on this! You guys are absolute stars! I'm actually looking forward to the conversations on this one at work tomorrow, LOL.