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Constituent Adjustment and Index Maintenance
- Upon occurrence of any of the below-listed events, the TAIEX base value computed by the TWSE shall be adjusted to maintain TAIEX continuity:
- Effective date of addition or deletion of a constituent;
- Ex-right date of subscription of common shares for cash capital increase; adjustment on the date of resumption of suspended trading if listed companies carry out a capital reduction and cash capital increase as well;
- Listing date of distribution of common shares or certificates of entitlement to new shares to employees as compensation;
- Ex-right date of distribution of common shares as stock dividends on preferred shares;
- Ex-right date of holding of the treasury stock for which capital reduction has not been carried out by a listed company;
- Ex-right date or the third trading day of the next month following public announcement of a capital decrease by a listed company, whichever comes first, for share cancellation in accordance with the law;
- Reversing to the original number of issued shares on the third trading day of the next month following receipt of notification of a failed offering for a cash capital increase by a listed company;
- Listing date of certificates of entitlement to new shares or issuance of new shares following a company merger or consolidation;
- Listing date of common shares issued in replacement of certificates of entitlement to convertible corporate bonds;
- Ex-right date or the third trading day of the next month following the public announcement of capitalization amendment registration in the event of common shares converted directly from convertible corporate bonds or shares issued through exercise of securities with subscription rights;
- Listing date of cash capital increase shares or certificates of payment for which shareholders have waived subscription rights and public underwriting has been adopted;
- Listing date of new shares issued for global depositary receipts;
- Ex-right date or the third trading day of the next month following the public announcement of capitalization amendment registration in the event of common shares converted from convertible preferred shares;
- The date of resumption of suspended trading by the listed company carrying out procedures for the issuance of new replacement shares due to a capital reduction or a change in par value.
- Ex-right date or listing date of new restricted employee shares;
- Ex-right date or the third trading day of the next month following the public announcement of capitalization amendment registration in the event of shares issued through exercise of employee stock warrants;
- Or other non-trading factors affecting aggregate market value.
- The formula for adjustment of the base value is as follows:
Base value of the current day = Base value of the previous day * (Adjusted aggregate market value after the close of the previous day / closing aggregate market value of the previous day)
Adjusted aggregate market value after the close of the previous day = Closing aggregate market value of the previous day + sum total of all adjustments in market value
- Adjustments in market value are calculated as follows:
- Article 5, Paragraph 1, Subparagraph 1 of these Directions:
Adjusted market value = Closing price of the previous day * number of shares issued, or = Retained market value
- Article 5, Paragraph 1, Subparagraph 2 of these Directions:
Adjusted market value = Subscription price of cash capital increase * number of cash capital increase shares
- (Article 5, Paragraph 1, Subparagraph 3 of these Directions:
Adjusted market value = Closing price of the common shares before the listing date of distribution of common shares or certificates of entitlement to new shares to employees as compensation * number of shares resulting from compensation to employees
- Article 5, Paragraph 1, Subparagraph 4 of these Directions:
Adjusted market value = Ex-right/Ex-dividend reference price of common shares * total number of common shares issued as stock dividends on preferred shares
- Article 5, Paragraph 1, Subparagraph 5 of these Directions:
Adjusted market value = Aggregate market value on the ex-right date – aggregate market value before the ex-right date
Market value before the ex-right date = (Closing price before the ex-right date – cash dividends per share) * number of shares issued before the ex-right date
Market value on the ex-right date = (Closing price before the ex-right date – cash dividends per share) / (1 + shareholder stock dividend rate) * number of shares issued on the ex-right date
- Article 5, Paragraph 1, Subparagraph 6, 7, 8, 9, 10, 11, 12, 13, 15, 16, and 17 of these Directions:
Adjusted market value = Closing price of the previous day * change in the number of shares
- Article 5, Paragraph 1, Subparagraph 14 of these Directions:
Adjusted market value = reference price on the date of resumption of suspended trading * number of shares issued on the date of resumption of suspended trading – retained market value
Number of shares issued on the date of resumption of suspended trading do not include the number of cash capital increase shares if a listed company carries out a capital reduction and cash capital increase as well.
- Retained market value is determined by the principles set out in Article 4, Paragraph 4.
- If the closing price of the previous day is not available, the opening auction reference price of the current day may be used for the calculation of the various adjusted market values in accordance with Article 5, Paragraph 3.
- The base value is not adjusted for cash dividends, except for the Total Return Index. The formula for adjustment of the base value of the Total Return Index is as follows:
Base value of the current day = Base value of the previous day * [ (adjusted aggregate market value after the close of the previous day – aggregate cash dividends distributed on the current day) / closing aggregate market value of the previous day ]
NOTE: The English version is for reference only. If there is any discrepancy between the English version and the Chinese version, the Chinese version will prevail.
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