- The NZX houses some of the most eminent companies offering handsome dividends to its investors.
- Investing in NZX 50 acts as a boon for the investors who want to multiply their funds by investing in stocks pertaining to various market segments.
- To start trading, one needs to contact an NZX market participant, a list of which is mentioned on the NZX.
New Zealand is one of the highly developed economies of the world, with a GDP of about US$209.33 billion in terms of the US dollars as of 2020.
With a well-defined and developed stock exchange, investors can invest in the stocks of these companies and in turn, get favourable rewards by way of dividends.
Source: Copyright © 2021 Kalkine Media
A peek into the NZ Stock Exchange
As we all know, the New Zealand Stock Exchange, commonly known as the NZX, is the national stock exchange of New Zealand.
Based in Wellington, NZX comprises NZX Main Board (NZSX), the NZX Debt Market (NZDX), the NZX Dairy Derivatives, the NZX Equity Derivatives (NZCX), and the Fonterra Shareholders' Market.
The NZX offers a marketplace to the traders and investors to buy and sell the NZX-listed funds and equities.
What is NZX 50?
The NZX 50 is the benchmark index of New Zealand, which keeps a tab on the performance of the 50 biggest and the most liquid stocks by free-float market capitalisation trading on the New Zealand Stock Exchange.
Equipped with investable stocks and liquidity, the NZX 50 index covers around 90% of the NZ equity market capitalisation.
Due to the commercialisation, NZX Equity Indices were changed to S&P Dow Jones Indices in 2015, with indices' names now starting with S&P/NZX.
On 4 June, by the end of the market session, S&P/NZX 50 Index was in green, at 12,496.270 basis points, rising by 0.52%.
Which companies constitute the NZX 50?
The names of some of the well-known and the largest companies constituting NZX 50 are enumerated below.
- Fisher & Paykel Healthcare Corporation Limited (NZX:FPH; ASX:FPH)
- Auckland International Airport Ltd (NZX:AIA; ASX:AIA)
- Westpac Banking Corporation (NZX:WBC; ASX:WBC)
- Spark New Zealand Ltd (NZX:SPK; ASX:SPK)
- Telstra Corporation Limited (NZX:TLS; ASX:TLS)
- Meridian Energy Ltd (NZX:MEL)
- Mainfreight Limited (NZX:MFT)
- Fletcher Building Ltd (NZX:FBU;ASX:FBU)
- Contact Energy Ltd (NZX:CEN)
- Infratil Ltd (NZX:IFT; ASX:IFT)
- Ryman Healthcare Group Ltd (NZX:RYM)
As mentioned earlier, the NZX 50 comprises the most stocks by market capitalisation trading on the NZX.
Healthcare, utilities and industrials constitute more than half of the NZX 50 companies, i.e. the sector-wise breakdown of the NZX 50 is - healthcare 25.7%, utilities 20.2%, industrials 17.3%, real estate 9.2%, and communication services 9.1%, etc.
How to invest in NZX 50 shares?
Investing in the NZX 50 is quite easy. To start trading, one needs to contact an NZX market participant, a list of which is mentioned on the NZX.
Moreover, one must ascertain the type of investment according to their financial capacity and risk appetite.
Then, after a good research and study, one can start investing either through brokers, trading platforms, and banks, or financial advisors.
Is NZX 50 a good investment?
New Zealand is one of the most advanced countries in the Asia Pacific region and one of the very few countries across the globe, which has successfully contained the spread of COVID-19.
It is home to some of the most prosperous and dynamic companies of New Zealand as well as the APAC region. Investing in NZX 50 companies gives the investors an opportunity to invest in some of the nation's largest stocks, thereby reaping benefits and maximising the returns.
Now, let’s catch up with some of the top NZX 50 stocks.
One of the leading healthcare companies, Fisher & Paykel Healthcare Corporation Limited boasts of a market capitalisation of NZ$16.8 billion.
In its recently declared annual results for the year ended 31 March 2021, FPH recorded an NPAT of NZ$524 million, up 82% on the preceding year and will pay a final dividend of 22.0 cps on 25 June 2021.
On 4 June, by the end of the trading session, Fisher & Paykel Healthcare Corporation was up by 0.45% at NZ$29.
The prime airline hub in New Zealand, Auckland International Airport Limited, has a market capitalisation of nearly NZ$11 billion.
Its Chief Executive, Adrian Littlewood, will seek a departure from the Company towards the end of 2021.
On 4 June, by the end of the trading session, Auckland International Airport was down by 0.26% at NZ$7.610.
Another NZX 50 company is Spark New Zealand Limited, operating as a telecommunications company.
Its subsidiary, Spark Finance, extended the duration of its NZ$200 million worth standby credit facility, which will now mature towards the end of April in 2024.
On 4 June, by the end of the trading session, Spark New Zealand was up by 1.19% at NZ$4.660.
The telecommunications giant Telstra Corporation Limited has a market capitalisation of about NZ$45 billion.
The Company has recently announced its investment of about $270 million in a 26 GHz spectrum auction, thereby reinforcing its leadership in the 5G segment.
On 4 June, by the end of the trading session, Telstra Corporation was up by 1.59% at NZ$3.830.