What a Stock Market Index Actually Measures
A stock market index condenses the performance of a basket of stocks into a single number. It serves as a market thermometer, a benchmark for portfolio managers, and the underlying asset for ETFs. But not all indices are created equal: their construction — number of constituents, weighting method, dividend treatment — determines what story they actually tell.
Two essential concepts before comparing African indices:
Price Return vs Total Return Index. A *price return* index only tracks share price changes. A *total return* index reinvests dividends in the calculation. On African markets, where dividend yields reach 5–9%, this distinction radically changes the picture. Example: TUNINDEX is explicitly a total return index (dividends reinvested), while the NGX 30 is a price index.
Why exchanges maintain multiple indices. The broad index (all stocks) serves as a general barometer. The blue-chip index (Top 40, NGX 30, MSI20) targets liquidity. The equal-weight index (EGX 70 EWI) corrects for domination by a few giants. The capped index (TUNINDEX, 15% cap) prevents a single stock from overwhelming the benchmark.
Morocco — MASI
| Feature | Detail |
|---|---|
| Full Name | Moroccan All Shares Index |
| What it Measures | The entire Casablanca equity market |
| Constituents | ~75 (all listed stocks) |
| Weighting | Float-adjusted market cap, with capping |
| Type | Price return |
| 5-Year Performance | +49.8% |
| Rebalancing | Annual review of float factors and capping |
The MASI is a comprehensive index: it includes every stock listed on the Casablanca Stock Exchange. Float-adjusted market cap weighting means only shares actually available for trading count — blocks held by founders or the state are excluded. A capping factor prevents any single stock from dominating the index.
Most influential stocks: Attijariwafa Bank (~19% of the market), Marsa Maroc (~9%), Maroc Telecom (~8%), LafargeHolcim Maroc (~6%), Bank of Africa (~5%).
For institutional liquidity needs, the exchange also publishes the MSI20 — the 20 most actively traded stocks over a rolling six-month period.
How to invest: No public MASI ETF. Access through direct stocks, Moroccan mutual funds, or the VanEck Africa Index ETF (AFK) which includes Casablanca blue chips.
BRVM — Composite and BRVM 30
BRVM Composite
| Feature | Detail |
|---|---|
| What it Measures | The entire BRVM equity market (8 WAEMU countries) |
| Constituents | ~47 (all listed stocks) |
| Weighting | Market capitalization |
| Type | Price return (Total Return version available) |
| 5-Year Performance | +190% |
| Currency | XOF (CFA franc, pegged to the euro) |
The BRVM Composite is the broad barometer of the West African regional exchange — a unique case globally: a single stock exchange for eight countries (Senegal, Ivory Coast, Benin, Burkina Faso, Guinea-Bissau, Mali, Niger, Togo). The +190% five-year performance makes it one of the continent's top-performing indices.
The structural advantage: the CFA franc is pegged to the euro (1 EUR = 655.957 XOF). For a euro-based investor, local and euro-denominated performance are identical — a rare luxury in sub-Saharan Africa. In 2025, the Composite gained 25.3% in XOF/EUR and 41.8% in USD (due to dollar weakness against the euro).
BRVM 30
| Feature | Detail |
|---|---|
| What it Measures | The 30 most active and capitalized stocks |
| Constituents | 30 |
| Launch | January 2, 2023 (base 100) |
| Selection Criteria |
50%, average transaction
market median |
| Rebalancing | Quarterly |
|---|
The BRVM 30 replaced the older BRVM 10 to provide a more representative benchmark. Its selection criteria are among the most rigorous on the continent: a company must be profitable in 3 of the last 5 fiscal years and maintain trading frequency consistently above 50%. Note: no 5-year history available (launched 2023).
Dominant stocks: Sonatel (Senegal, telecoms), Orange Cote d'Ivoire (telecoms), Ecobank CI (finance), Coris Bank International (Burkina Faso, finance).
Tunisia — TUNINDEX
| Feature | Detail |
|---|---|
| What it Measures | The entire Tunisian equity market |
| Constituents | ~65 |
| Weighting | Float-adjusted market cap, 15% cap per stock |
| Type | Total Return (dividends reinvested) |
| Base | 1,000 on 12/31/1997 |
| 1-Year Performance | +40% (all-time high ~15,400 points in March 2026) |
| Rebalancing | Quarterly (January, April, July, October) |
The TUNINDEX stands out for two important features:
- 1.It is a total return index — dividends are reinvested in the calculation. Comparing TUNINDEX to a *price return* index (like the MASI or NGX ASI) is comparing apples to oranges. TUNINDEX will systematically appear more performant over the long term, simply because it includes dividends.
- 1.The 15% cap — no single stock can exceed 15% of the index weight. This rule prevents single-stock domination, which is crucial in a market where the financial sector represents over 60% of capitalization.
Influential stocks: BIAT (14.5% of the market), Poulina Group Holding, Attijari Bank, SFBT, Amen Bank.
TUNINDEX is also published in USD and EUR, facilitating international comparisons. To invest: direct stocks or Tunisian funds. No public TUNINDEX ETF.
Egypt — EGX 30, EGX 70 EWI, EGX 100 EWI
The EGX is the continent's most sophisticated exchange for index engineering, with a three-tier system designed to solve the concentration problem.
EGX 30
| Feature | Detail |
|---|---|
| What it Measures | The 30 most active and liquid companies |
| Weighting | Float-adjusted market cap |
| Liquidity Threshold | Trading on at least 95% of days during the review period |
| Sector Constraint | Max 5 companies per sector |
| Buffer Rule | Top 27 automatic, current members within top 33 prioritized |
| Rebalancing | Semi-annual (February 1, August 1) |
| 5-Year Performance | +344% |
The EGX 30 is the flagship. Its nominal +344% five-year performance is spectacular — but largely reflects Egyptian pound devaluation and domestic inflation. In USD, the return is significantly more modest (but still positive: +49.4% in 2025 alone, thanks to FX reforms and foreign capital inflows).
Dominant stock: Commercial International Bank (CIB) — the undisputed heavyweight.
EGX 70 EWI and EGX 100 EWI (Equal Weight)
| Index | Constituents | Weighting | 5-Year Performance |
|---|---|---|---|
| EGX 70 EWI | 70 (excluding EGX 30) | Equal | +547% |
| EGX 100 EWI | 100 (EGX 30 + EGX 70) | Equal | +519% |
Egypt made a strategic choice: use equal weighting for its mid-cap and broad indices. Each stock carries the same weight, which prevents CIB or TMG from dominating the benchmark, better reflects overall market sentiment, and has systematically outperformed the EGX 30 over the long term (as Egyptian mid-caps outperformed blue chips).
Available ETF: EGX30 ETF (locally listed).
South Africa — FTSE/JSE All Share (J203) and FTSE/JSE Top 40 (J200)
FTSE/JSE All Share (J203)
| Feature | Detail |
|---|---|
| What it Measures | ~99% of Main Board capitalization |
| Constituents | Variable (no fixed number) |
| Weighting | Investable market cap (float + liquidity, FTSE Russell methodology) |
| 5-Year Performance | +70.5% |
| Rebalancing | Quarterly (March, June, September, December) |
FTSE/JSE Top 40 (J200)
| Feature | Detail |
|---|---|
| What it Measures | The 40 largest stocks by investable market cap |
| Constituents | 40 |
| 5-Year Performance | +80.4% |
The JSE is Africa's deepest and most liquid market, and its indices are co-managed with FTSE Russell according to the strictest international standards.
The "Rand Hedge" phenomenon: over 65% of Top 40 company earnings are generated outside South Africa in foreign currencies (USD, GBP, EUR). Consequence: when the rand weakens, the index rises (foreign earnings are worth more in ZAR). This defensive effect is unique to the JSE.
Top 5 constituents (February 2026): Gold Fields (10.0%), AngloGold Ashanti (8.6%), Naspers (8.1%), FirstRand (6.2%), Standard Bank (5.1%).
ETFs: Satrix Top 40 (STX40), Satrix ALSI, Sygnia Itrix Top 40 — among the most liquid financial instruments in Africa.
Nigeria — NGX All-Share (ASI) and NGX 30
NGX All-Share Index (ASI)
| Feature | Detail |
|---|---|
| What it Measures | The entire NGX market |
| Weighting | Market capitalization |
| 5-Year Performance | +411% |
The Nigerian ASI has experienced one of the most explosive bull runs in global frontier markets. But as with Egypt, this nominal performance largely reflects naira devaluation. In USD, returns are impressive (+60.6% in 2025 alone) but well below the nominal headline.
NGX 30
| Feature | Detail |
|---|---|
| What it Measures | The 30 largest companies by capitalization and liquidity |
| Weighting | Adjusted market cap |
| Type | Price index |
| Rebalancing | Semi-annual (January 1, July 1) |
Dominant stocks: Dangote Cement, MTN Nigeria, Zenith Bank, BUA Foods, Seplat Energy.
ETFs: Vetiva Griffin 30 ETF (VETGRIF30) — replicates price and yield performance of the 30 constituents. Stanbic IBTC ETF 30 also available.
Kenya — NSE 20 and NSE All-Share (NASI)
NSE 20 Share Index
| Feature | Detail |
|---|---|
| What it Measures | 20 blue-chip stocks |
| Weighting | Price-weighted |
| Constituents | 20 |
The NSE 20 is a historical relic: created in the 1960s, it still uses price weighting (like the old Dow Jones). This means stocks with the highest unit price (like BAT Kenya) have disproportionate influence, regardless of their actual company size. This methodology is considered obsolete for institutional management.
NSE All-Share Index (NASI)
| Feature | Detail |
|---|---|
| What it Measures | The entire Kenyan market |
| Weighting | Market capitalization (market-cap weighted) |
| 2025 Performance | +51.1% in KES, +51.5% in USD |
The NASI is the modern benchmark. But it suffers from the "Safaricom problem": at approximately 47-65% of total NSE capitalization, Safaricom dominates the index so thoroughly that the NASI is essentially a barometer for a single company.
| Comparison | NASI | NSE 20 |
|---|---|---|
| Method | Cap-weighted | Price-weighted |
| Safaricom Weight | ~47-65% | ~1% |
| Institutional Use | Yes | Outdated |
Comparison Traps: A Practical Guide
Concentration Risk
On nearly every African exchange, the top 3-5 stocks represent between 35% and 65% of the total index. In practice, "investing in the index" often means betting on a handful of companies:
| Market | Concentration | Dominant Stock |
|---|---|---|
| Kenya (NASI) | Extreme (~50-65%) | Safaricom |
| JSE (Top 40) | High (~35%) | Gold Fields + AngloGold |
| Egypt (EGX 30) | High | CIB |
| Nigeria (ASI) | Moderate-High | Dangote Cement |
| Morocco (MASI) | Moderate (capped) | Attijariwafa Bank |
| BRVM (Composite) | Moderate | Sonatel |
| Tunisia (TUNINDEX) | Moderate (15% cap) | BIAT |
The 2017 Steinhoff collapse on the JSE — causing systemic losses across "diversified" funds — illustrates the danger: apparent diversification in a broad index can be illusory when a few stocks dominate.
Comparing Indices Across Currencies
The conversion formula:
USD Return = (1 + Local Return) x (1 + FX Change) - 1
In 2025, the BRVM Composite gained 25.3% in XOF but 41.8% in USD — the difference comes from dollar weakness against the euro (CFA is pegged to EUR). Conversely, a Nigerian index gaining 50% in NGN may yield only 10% in USD if the naira lost 40%.
Rule of thumb: always compare in a reference currency (USD or EUR) for international comparisons. Use local currency to judge internal market dynamics.
Total Return vs Price Return: The Real Benchmark
| Index | Type | Dividends Included? |
|---|---|---|
| TUNINDEX | Total Return | Yes |
| BRVM Composite | Price (TR available) | No (except TR version) |
| MASI | Price Return | No |
| EGX 30 | Price Return | No |
| JSE Top 40 | Price (TR available) | No (except TR version) |
| NGX 30 | Price Return | No |
| NSE 20/NASI | Price Return | No |
On markets where dividends represent 5-9% annually, the Total Return version outperforms Price Return by 30-50% over five years. If you compare your portfolio (which collects dividends) to a price return index, you're understating the real benchmark.
Summary Table
| Exchange | Primary Index | Weighting | Constituents | Rebalancing | 5yr Perf |
|---|---|---|---|---|---|
| Morocco | MASI | Float cap (capped) | ~75 | Annual | +49.8% |
| BRVM | BRVM Composite | Market cap | ~47 | — | +190% |
| BRVM | BRVM 30 | Market cap | 30 | Quarterly | n/a (since 2023) |
| Tunisia | TUNINDEX | Float cap (15% cap) | ~65 | Quarterly | Record 2026 |
| Egypt | EGX 30 | Float cap | 30 |
*Information provided is for informational purposes only and does not constitute investment advice. Past performance does not guarantee future results.*