The golden rule that the index candidates are equipped with an attractive price development and a medium-term relative strength in the run-up to the subsequent index adjustment, applies particularly to stock indices that are the focus of investors. The Euro Stoxx 50 with its high number of active and passive investments with index reference should be mentioned first in the Eurozone. The major Finnish bank Nordea Bank, a technical purchase, has successfully started the race for inclusion in the Euro Stoxx 50 2022. On the other hand, it should come as no surprise when the currently smallest titles in the Euro Stoxx 50, the Finnish mechanical engineering group Kone Oyj, a technical sale, and the Dutch media group Universal Music Group, a technical holding position,due to the index withdrawal risk are forced into a medium-term relative weakness.

In the Euro Stoxx 50, several changes in the index composition are becoming apparent in the near future.

First, the spin-off from Daimler Truck is due in December 2021.

For two old Daimler shares, shareholders receive two new Daimler shares plus one Daimler truck share.

On the day of the spin-off, the Euro Stoxx 50 will consist of 51 stocks.

At the close of trading on the spin-off day, the smallest index security in free float according to market capitalization, probably Daimler Truck, must leave the Euro Stoxx 50.

The new Daimler shares remain in the Euro Stoxx 50, but then with a lower index weight.

Nordea Bank is a technical acquisition

With a view to 2022, the regular index adjustment process remains. The so-called selection list for the Euro Stoxx 50 is created in a two-stage, key date-related selection process based on the market capitalization in the free float. Non-index stocks that are in position 40 or better on this list are automatic candidates for inclusion for September 2022. Index stocks with list position 61 or worse are automatic index removal candidates.

Due to this selection process, the French Hermes International (luxury goods) and Dassault Systèmes (technology) are currently not available for index inclusion, although both stocks are under discussion because of their free float market capitalization. In return, the Finnish Nordea Bank got off to a very good start in the race for inclusion in the Euro Stoxx 50 in 2022. In contrast, both the Dutch Universal Music Group and the Finnish mechanical engineering group Kone Oyj will find it difficult to defend their membership in the index.

Nordea Bank, which is currently classified as “Finnish” from an index-technical point of view, emerged in 2001 from the merger of four Scandinavian financial institutions. In 2018, the headquarters in Finland was relocated to the headquarters in Helsinki, in order to be better positioned in terms of regulatory and cost-effectiveness. In this context, several capital measures were carried out, so that Nordea Bank moved up to position 7 in the European sector index Stoxx Banks. The significantly increased market capitalization in free float - in combination with the good technical price development - meant that this share got off to a very good start in the race for a Euro-Stoxx-50 admission (in 2022). The title is already in an automatic index recording position.