THE blue-chip Hang Seng Index turned a redder shade of purple last week, with the entry of red chip China Resources Enterprise into the list of components.
The question now is: Which one next? The firm answer from analysts was Cosco Pacific, controlled by China Ocean Shipping Company.
Another commonly held view is the inevitable departure from the benchmark index of Stanley Ho's Shun Tak Holdings, which has seen turnover dry up and market capitalisation shrink over the past year.
Analysts say within the next three to five years red chips, controlled by municipal and city governments on the mainland, will account for roughly half the Hang Seng Index.
The criteria for inclusion among the 33 most representative stocks trading in Hong Kong are already in place in many of those companies included in the Hang Seng China-Affiliated Index. Meanwhile, there are several blue chips lagging behind expectations.
Apart from relatively high turnover and market capitalisation, companies are required to have been listed for two years.
