Taiwan High Compensation 100 Index: What It Measures and How It Is Built

Direct Answer

The Taiwan High Compensation 100 Index is a rule-based measurement of Taiwanese high-dividend equity benchmark, maintained by TWSE/FTSE Russell. Like every index it owns nothing: it is a number produced by applying a published weighting formula to a selected list of companies, revised on a schedule the provider sets.

What this index covers

The Taiwan High Compensation 100 Index covers Taiwanese high-dividend equity benchmark, within the Taiwan market. TWSE/FTSE Russell defines which securities are eligible, how they are selected from that pool, and how much each one contributes to the published number.

The name states a target of 100 companies. A target is not a guarantee of the exact count on any given day: corporate actions, dual share classes and pending additions all move the real number around it.

How constituents are weighted

Weighted by a fundamental value rather than market capitalization. Fundamental value blends three year average total employee compensation (grown by the rolling growth rate of compensation per employee) and three year average net profit, and each weight is capped at 10%.

The weighting method is the single biggest driver of how an index behaves. Two indexes covering the same market can diverge for years purely because they weight differently, which is why comparing index levels without knowing the method tells you very little.

What qualifies for inclusion

Taiwan Stock Exchange listings, excluding full delivery stocks, suspended stocks and foreign issuers. The lowest 20% by average daily trading value are removed, then stocks must be in the top third by three year average compensation per employee, with positive average net profit and book value per share of at least NTD 10.

Eligibility rules are the part of an index most readers never look at and the part that decides what it can possibly measure. A screen that excludes a whole sector, or admits only one listing venue, shapes the result far more than any day of trading does.

When the membership is revised

Reviewed annually in May using data at the close of May 25. Results are published on the fourth trading day after May 25 and take effect on the tenth, with rebalancing spread over five consecutive trading days.

Reconstitution is the one date an index changes shape by design rather than by price. Funds tracking it have to trade toward the new membership, which is why the schedule matters to anyone holding the tracker rather than only to the provider.

The rule that surprises people

The 100 stocks are ranked by total compensation amount over three years, not by pay per employee, which is only the entry screen. Vacancies from deletions are not refilled between reviews, so the count can fall below 100.

References

• TWSE/FTSE Russell: Taiwan Stock Exchange Methodology of TWSE RAFI Taiwan High Compensation 100 Index, as published 2023. Every rule described on this page is taken from this document.

Current Taiwan High Compensation 100 Index constituents

TWSE/FTSE Russell publishes and licenses the Taiwan High Compensation 100 Index constituent list. Swoopr does not republish it here. The provider's own page is the authoritative source for current membership and weights.

TWSE/FTSE Russell: official Taiwan High Compensation 100 Index page

Related reading

• All stock market indexes: how indexes are built, weighted and revised.
• Asia-Pacific indexes: others covering the same region.
• Index concentration: measuring how much of an index sits in its largest holdings.
• Index rebalancing and inclusion effects: what happens to a stock when index membership changes.

Frequently Asked Questions