Luxembourg Stock Exchange publishes two stock indexes: The Luxembourg Stock
Price Index and the Luxembourg Stock Return Index. There is no further
division into sectoral indexes. Luxembourg-based companies are eligible
for inclusion in the index sample if they are representative of the Luxembourg
economy and with business activity in Luxembourg. Since out of the about
70 stocks listed on the stock exchange the vast majority are holdings or
investment trusts with their main business activity pursued abroad, only
13 stocks have been eligible for inclusion.
No explicit use is made of such criteria
as market capitalization or trading volume except for the fact that both
figures should be sufficient to assure a reasonable degree of liquidity.
Stocks are included in the index starting with the first day of public
trading on the stock exchange. De-listed stocks are withdrawn from the
index. Contrary to common practice that draws upon the last available price(s)
for calculating the indexes in the case of suspensions from trading, the
Luxembourg Stock Exchange temporarily withdraws the respective stock from
the index sample.
The Price Index is adjusted for the
usual set of transactions except for dividends, whereas the Return Index
is adjusted for dividend payments by adding the dividends paid to the current
market capitalization in conjunction with the method of splicing.