Swiss Market Index

The Swiss Market Index (SMI) is Switzerland's blue-chip stock market index, which makes it the most followed in the country.^[2][3] It is made up of 20 of the largest and most liquid Swiss Performance Index (SPI) stocks.^[1] As a price index, the SMI is not adjusted for dividends.^[4]

Swiss Market Index

SMI performance between 1988 and 2012
Foundation	30 June, 1988
Operator	SIX Swiss Exchange
Exchanges	SIX Swiss Exchange
Trading symbol	SMI
Constituents	20
Type	Large-cap, price index
Market cap	CHF 1,046 billion (26 February 2021, free-float-adjusted)[1]
Weighting method	Market-value-weighted
Related indices	SMI MID, SMI Expanded, SPI 20, SPI, SLI
Website	six-group.com
ISIN	CH0009980894
Reuters	.SSMI
Bloomberg	SMI:IND

The SMI was introduced on 30 June 1988 at a baseline value of 1,500 points. It closed above the symbolic level of 10,000 points^[5] for the first time on 2 July 2019. It reached the 12,000 point milestone on 17 June 2021.^[6] It is currently in a bear market,^[7] which it entered on 22 September 2022 after losing more than 20%. This ended the bull market that had reached an all-time record closing price short of 13,000^[8] on 28 December 2021.

Its composition is examined once a year. As of September 2022, it contains 18 large-caps and two mid-caps.^[9] Calculation takes place in real-time. As soon as a new transaction occurs in a security contained in the SMI, an updated index level is calculated and displayed. However, the index is updated no more than once per second.^[10] The SMI is calculated in Swiss Francs, the currency of Switzerland.^[11]

The securities contained in the SMI currently represent approximately 70%^[1] of the free-float Swiss equity market capitalization, as well as 85% to 90% of the total trading turnover^[12] of Swiss and Liechtenstein equities listed on the SIX Swiss Exchange. Because the SMI is considered to be a mirror of the overall Swiss stock market, it is used as the benchmark for numerous mutual funds, index funds and ETFs, and as the underlying index for numerous derivative financial instruments such as options, futures and structured products.

In 2020, the SMI, along with other SIX indices, was endorsed under the EU Benchmarks Regulation and is registered with the European Securities and Markets Authority, which means that it can be used as an underlying for financial products sold in the EU.^[13]

Rules

Acceptance criteria

The underlying universe of the SMI, from which candidate constituents are selected, is the SPI. To be accepted into the SMI, a given issue must meet stringent requirements with regard to liquidity and market capitalization. On the one hand, it must represent at least 50% of the average liquidity of the SPI constituent issues. On the other hand, it must have a minimum free-float capitalization equal to 0.45% or more of the entire SPI capitalization. Thus, trading volume and capitalization are the determining factors in the quarterly rankings. The composition of the index is reviewed annually on the third Friday in September.^{[citation needed]}

Fixed number of 20 securities

The SMI comprises a fixed number of 20 securities as of the ordinary review date in September 2007. Prior to this date, the index contained 25 listings.^{[citation needed]}

It is worth noting that the number of constituents of the index (20) is below the generally accepted minimum sample size of 30 required to reach statistical significance.^{[citation needed]}

Capped weightings

In 2017, in order to address the issue that the top three constituents (Nestlé, Roche, Novartis) account for more than 60% of the index capitalization, SIX Swiss Exchange changed the rules of the SMI to introduce capped weighting.^[10] The weight of any constituent in the SMI index can no longer exceed 18%.^{[citation needed]}

Readjusting any weight exceeding 18% down to that value is done, in principle, on a quarterly basis. However, whenever a constituent reaches a weight exceeding 20% during a quarter (intra-quarter breach), then the weight is brought back to 18% without waiting for the next quarterly review.^{[citation needed]}

To make the transition smoother, there was an initial transition period during which these changes were progressively implemented, in steps of at most 3% per quarter.^{[citation needed]}

Additionally, a new index, the SPI 20, was created to continue indexing the 20 SMI constituents without any caps.^{[citation needed]}

SMI constituents

Current constituents

Market capitalisation of SMI index firms by canton of incorporation as of September 2022

As of 13 June 2023, the following 20 stocks make up the SMI index.^[9][14]

The rank is based on free-float capitalization as of 13 June 2023. The first ten weights are given as of 28 April 2023.^[1] The other weights are given as of 23 March 2020. The latest update following the ordinary review was implemented in June 2023, when Kuehne + Nagel replaced Credit Suisse Group.

Rank	Name	Industry	Ticker	Canton	Weighting in %
1	Nestlé SA	Food	NESN.SW	Vaud	19[1]
2	Roche Holding AG	Pharmacy	ROG.SW	Basel	17[1]
3	Novartis International AG	Pharmacy	NOVN.SW	Basel	17[1]
4	Compagnie Financière Richemont SA	Luxury Goods	CFR.SW	Geneva	7[1]
5	Zurich Insurance Group AG	Insurance	ZURN.SW	Zurich	6[1]
6	UBS Group AG	Banks	UBSG.SW	Zurich/Basel	5[1]
7	ABB Ltd	Electrical equipment	ABBN.SW	Zurich	4[1]
8	Lonza Group AG	Chemistry	LONN.SW	Basel	4[1]
9	Sika AG	Chemistry	SIKA.SW	Zug	3[1]
10	Alcon Inc	Pharmacy	ALC.SW	Fribourg	3[1]
11	Givaudan SA	Chemistry	GIVN.SW	Geneva	3
12	Holcim Limited	Building materials	HOLN.SW	St. Gallen	2
13	Swisscom AG	Telecommunications	SCMN.SW	Bern	2
14	Partners Group Holding AG	Private equity	PGHN.SW	Zug	2
15	Swiss Reinsurance Company Ltd	Insurance	SREN.SW	Zurich	2
16	Sonova	Medical devices	SOON.SW	Zurich	2
17	Geberit AG	Sanitary engineering	GEBN.SW	St. Gallen	2
18	Swiss Life Holding AG	Insurance	SLHN.SW	Zurich	1
19	Logitech International SA	Computer hardware and software	LOGN.SW	Vaud	1
20	Kuehne + Nagel	Logistics	KNIN.SW	Schwyz	1

SMI family

SMI is also the name of a family of indices encompassing the SMI itself, but also the SMI MID with the next 30 large-caps (2) and mid-caps (28), and the SMI Expanded with all 50 shares.

The indices are available in several variations. For example, the SMI, which is a price index, also exists as a performance index, the SMI Cum Dividend (SMIC), which takes into account dividend distributions.^[1]

History

History of index constituents

Date	Event
June 2007	The ranking as of 30 June 2007 (according to average capitalization and the turnover achieved during one year, i.e. from 1 July 2006 through 30 June 2007) determined which companies would remain within the SMI after the number of issues was changed to 20. On 5 July 2007, SWX announced that Ciba Specialty Chemicals, Lonza Group, Givaudan, SGS and one of the two classes of shares of Swatch Group would leave the SMI as of 24 September 2007 leaving 20 securities in the index.[15]
September 2009	Nobel Biocare and Bâloise replaced by Lonza Group and SGS.[16]
June 2010	Swiss Life replaced by Transocean.[17]
September 2011	Lonza Group replaced by Givaudan.[18]
June 2012	Synthes replaced by Geberit following the merger with Johnson & Johnson.[19]
January 2016	Transocean replaced by Swiss Life.[20]
May 2017	Actelion replaced by Lonza Group after Actelion's purchase by Johnson & Johnson.[21] In the same month, Sika AG replaced Syngenta after its purchase by ChemChina.[22]
June 2018	Sika announced a 1:60 stock split.[23] Before this change, it was the SMI constituent with the highest price per share.
April 2019	Julius Bär replaced by Alcon after a spin-off (5:1) from Novartis.[24]
September 2020	Adecco replaced by Partners Group after the ordinary index review.[25]
May 2021	LafargeHolcim renamed to Holcim.
September 2021	Swatch Group was replaced with Logitech.[26]
September 2022	SGS SA was replaced with Sonova.[27]
June 2023	Credit Suisse Group was replaced with Kuehne + Nagel on June 12/13, 2023.[28]

Historical values

The following table shows the annual development of the Swiss Market Index since 1988.^[29]

Year	Closing level	Change in Index
		(Points)	(%)
1988	1,435.40
1989	1,778.10	342.70	23.87
1990	1,383.10	−395.00	−22.21
1991	1,670.10	287.00	20.75
1992	2,105.40	435.30	26.06
1993	2,956.70	851.30	40.43
1994	2,629.30	−327.40	−11.07
1995	3,299.20	669.90	25.48
1996	3,942.20	643.00	19.49
1997	6,265.50	2,323.30	58.93
1998	7,160.70	895.20	14.29
1999	7,570.10	409.40	5.72
2000	8,135.37	565.27	7.47
2001	6,417.84	−1,717.53	−21.11
2002	4,630.75	−1,787.09	−27.85
2003	5,487.81	857.06	18.51
2004	5,693.17	205.36	3.74
2005	7,583.93	1,890.76	33.21
2006	8,785.74	1,201.81	15.85
2007	8,484.46	−301.28	−3.43
2008	5,534.53	−2,949.93	−34.77
2009	6,545.91	1,011.38	18.27
2010	6,436.04	−109.87	−1.68
2011	5,936.23	−499.81	−7.77
2012	6,822.44	886.21	14.93
2013	8,202.98	1,380.54	20.24
2014	8,983.37	780.39	9.51
2015	8,818.09	−165.28	−1.84
2016	8,219.87	−598.22	−6.78
2017	9,381.87	1,162.00	14.14
2018	8,429.30	−952.57	−10.2
2019	10,616.94	2,187.64	25.95
2020	10,703.51	86.57	0.82
2021	12,875.66	2,172.15	20.29
2022	10,729.40	−2,146.26	-16.67
2023	11,137.79	408.39	3.81
2024	11,600.90	463.11	4.16

Milestones

The following table shows historic milestones of the Swiss Market Index. Latest seen values are not final: italic indicates that the value may be seen again if the bear market persists; parentheses indicate that the value will be seen again if we reenter a bull market (previous peak reached again); Other values may be seen again in case of a crash (assuming a threshold of -50%).

To keep the scale logarithmic, it uses increments similar to exchange ticks: 1 between 5 and 10, 2 between 10 and 20, 5 between 20 and 50, 10 between 50 and 100, etc.

(Closing price)	Value	First seen	Latest seen
Calibration	1,500.00	30 June 1988	2 February 1991
Record low	1,279.00	14 January 1991
Milestone	1,600.00	2 November 1988	24 December 1991
Milestone	1,800.00	2 August 1989	6 October 1992
Milestone	2,000.00	14 December 1992	14 December 1992
Milestone	2,500.00	5 October 1993	30 March 1995
Milestone	3,000.00	5 January 1994	25 September 1995
Milestone	3,500.00	7 March 1996	2 August 1996
Milestone	4,000.00	16 January 1997	14 March 2003
Milestone	4,500.00	17 February 1997	10 March 2009
Milestone	5,000.00	5 May 1997	11 August 2011
Milestone	6,000.00	8 July 1997	29 June 2012
Milestone	7,000.00	25 February 1998	3 January 2013
Milestone	8,000.00	1 July 1998	9 December 2016
Milestone	9,000.00	12 January 2007	30 March 2020
Milestone	10,000.00	2 July 2019	3 November 2020
Milestone	12,000.00	17 June 2021	20 January 2025
Maximum close	12,970.53	28 December 2021	(December 28, 2021)
Record high	12,997.15	3 January 2022