Top 40?

[Salv]

Ok so my question is this. Satrix 40 tracks the top 40 companies, but satrix 40 is a listed share in its self, and therefore (to my understanding) would be affected by supply and demand (and peoples subjective greed and fear)so how is it that satrix forty is able to track the top forty companies if it is affect *assuming i understand correctly) by a veriable independant of the top 40 companies ? Another quik one, the top 40 value on fin 24 is below any value in the 40 last trades in satrix 40 how is that possible? I am new to this, ur help would be apreciated. Thx

[SimonPB]

market maker, in other words there is always a buyer and seller at fair value so it can't run away.

[Salv]

O i see, so how does one then identify the fair value of the underlying shares ? (ie. the weighted average of the top 40 companies )

[SimonPB]

not the fair value of the underlying companies, but the fair value of the basket of companies. The basket/index details at www.satrix.co.za

[Big_Boy]

This is a great share for you to start with as you are in the top companies but not exposed to the volatility of one particular share. Good Luck.