Fund manager's comment: Trend towards redefining small caps by Gervais Williams

There are two indices against which institutions offering funds that invest in small companies measu...

There are two indices against which institutions offering funds that invest in small companies measure their performance. The Hoare Govett Smaller Companies Index was established in 1987 to measure the performance of the lowest capitalisation stocks that together represent one-tenth of the value of all listed UK equities. At its launch, the market capitalisation cut-off point was £108m. Subsequent rebalancing brought it to £298m at the beginning of 1993. At that point, the FT Smaller Companies Index was launched, including companies with a market capitalisation of up to £300m. Changes ha...