The Philippine Stock Exchange (PSE) has announced major updates to its criteria for companies joining the 30-member benchmark index, introducing a new market capitalization threshold and revised liquidity rules ahead of the February 2027 rebalancing period.
Under the new guidelines, only companies that rank within the top 98 percent of the total cumulative market capitalization of eligible securities can qualify for inclusion in the main index, as well as the PSE Dividend Yield, PSE MidCap, and sector indices. The local bourse stated in a memorandum that these changes aim to keep Philippine indices aligned with global standards while responding to evolving market needs.
To determine how easily shares can be traded, the exchange is introducing two new liquidity metrics: the Median Trading Activity Ratio and the Monthly Average Daily Value Turnover. These replace the previous liquidity assessment system, which had been in place since April 2011. To qualify for the main index under the new framework, a company must achieve a minimum Median Trading Activity Ratio of 15 percent over a 12-month period.
In addition, the exchange is introducing a special exception to its minimum public ownership requirement. While listed companies are generally required to maintain a 20 percent free float, the threshold will be lowered to 15 percent for large-cap companies valued at P250 billion or higher, provided they meet all other selection criteria. This policy adjustment comes as the market prepares for the upcoming public listing of Mynt, the parent company of financial technology platform GCash.
