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HSI China watch launch next week

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HSI Services, the company which compiles the Hang Seng Index (HSI), yesterday announced details of its long-awaited Hang Seng China-affiliated Corporations Index (HSCCI), which will track the market's recent star performers - red chips.

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The index, to be launched next Monday, was unveiled the day after red chips - mainland backed investment companies incorporated in Hong Kong - suffered their biggest sell-off in more than a year.

The index will track the performance of 32 red chips and like the HSI, it will be market capitalisation-weighted and calculated on a minute-by-minute basis.

It is being backdated to January 4, 1993, with a base value of 1,000.

HSI Services chairman Anthony Wong Kin-kwan said in April and May this year growth in the HSCCI outstripped the rise in the HSI, reflecting the high level of investor interest in red chips.

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The performance of red chips in the new index is similar to the HSI in 1993. Then in 1994 and 1995, the HSCCI under-performed the HSI.

Growing interest this year created a need for a new index to reflect the performance of the stocks, Mr Wong said.

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