Silicon Fen Top 20, the Cambridge Cluster's Own Share Price Index, is Launched
A new share price Index, measuring the Top 20 companies in the world renowned Cambridge Cluster of high-tech firms has been launched. The Index will be an approximation of the performance and potential of the leading companies.
(PRWEB) February 17, 2006
The Silicon Fen Top 20 Share Price Index has been launched by Silicon Fen Business Report, the online news site that exclusively reports business news about Cambridge's world renowned cluster of high tech companies.
The Index measures the share price movements of the top 20 companies in the region around Cambridge known as Silicon Fen as measured by market capitalization. Silicon Fen is the hottest and largest collection of high-tech companies outside Silicon Valley in California.
On Wednesday morning the index stood at 115.52. It appears on the www. siliconfenbusiness. com web site, along with business news about the region.
Editor of Silicon Fen Business Report, John Tilston, said "Because it monitors share prices of companies whose headquarters are in Silicon Fen, the index is an approximation of the collective shape of the Cambridge Cluster's profitability and performance. Its bottom line, if you like, because a company's share price reflects its performance and potential."
Companies in the Top 20 include the cluster giants ARM Holdings and CSR, both now capitalized at well over - its bottom line - as a company's share price usually reflects its performance and potential a billion pounds; ahead of buoyant Autonomy, which is hovering around £850m, and the middle ranking pack headed by Cambridge Antibody and Alizyme. There are several smaller companies, with Prelude Trust squeezing into 20th place with a market capitalization of about £45m.
The total collective value of the Silicon Feb Top 20 companies is over £6.2bn.
Given the volatility of high tech stocks in general and smaller capitalization companies, the editors of Silicon Fen Business Report expect to see the Top 20 Index wobble about from time to time.
There are at least two major approaches to structuring an index of share prices. The two most widely known, the FTSE 100, administered by the Financial Times, and the Dow Jones Industrial Index, administered by The Wall Street Journal (WSJ), adopt different approaches.
The FTSE 100 records changes in market capitalisation of the Top 100 companies (as measured by market capitalization), most of which are 'blue chips'. To avoid confusion of which companies constitute the top 100 on any single day, the constituents are fixed each quarter. It is a clear, transparent index.
The Dow Jones Industrial Index by contrast is a group of 30 top US companies that the editors of WSJ believe are representative of American industry. They weight the index in favour of the higher price stocks, such as Microsoft. They change it from time to time, though usually years go by without modification, based on whether they believe the selection still represents the structure of US industry.
We've chosen the FTSE 100 route, and will review, and if necessary amend, the list every quarter.
Of course, it does mean that many top quality firms are excluded because they are either too small or have chosen not to list their shares on a stock market. Also excluded are the local arms of the big multinationals like Toshiba, Microsoft and GlaxoSmithKline. These branches are critical to the overall health of the region's economy but we could not convince ourselves that their share price was routinely impacted by what they were doing in Cambridge, no matter how innovative.
The companies in the inaugural Silicon Fen Top 20 Share Price Index are:
Abcam; Acambis; Alizyme; Amino Technologies; ARM Holdings; Autonomy, Aveva; Cambridge Antibody; Cambridge Display Technology; CSR; CMR Fuel Cells; Dialight, Domino Printing; Intercytex; nCipher; NXT; Plasmon; Prelude Trust; TTP Communications; and, Xaar.
The base period for the index, when the index stood at exactly 100, was set at 5.15pm GMT on 1st February, 2006.
There will have to be changes in the make up of the index on 1 May, its scheduled review date. nCipher is likely to be removed if the takeover by SafeNet Inc is successful, as seems likely at this stage.
In addition, BioProgress will move into Cambridge Science Park in March and will force its way in. At this stage it would be a straight swap.
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