Where the economy’s fortunes are writ

NICOLE Cheyne, client relationship manager at the JSE, said the AltX provided a more accurate barometer of the South African economy than the Top 40.

“The AltX represents what is happening on the ground. If the country experiences tough economic times, this will also be seen on AltX.

“Since its inception in 2003, 104 companies have listed. Recently, Giyani Gold, an exploration miner headquartered in Canada, listed on the AltX.”

On the issue of who invests in AltX shares, Cheyne said it was a mix of institutional and private investors as well as the management of listed companies. “In general, institutional investors don’t consider companies below a certain market cap, thus excluding small caps. There need to be more analysts covering this sector. Often, AltX companies need extensive investor relations support to grow their investor base, but often they don’t have access to a full-time resource.

“If a company wishes to attract a broad investor base . . . it needs to promote an understanding of the company, its market and its prospects.”

The top three sectors by market cap on the AltX are industrials, financials and basic materials, which together make up 91% of the overall market cap. Year on year, the total market cap grew 5.7% to R14.9-billion, and average market cap is up 7.4% to R243-million. In all, 42% of stocks reported share price growth and 40% depreciated.