Comparative Analysis of the ASX and NSX
Comparative analysis consist comparison of two or more comparable in terms of alternatives, qualifications, sets of data, process, etc. In this consideration, each item must be considered in the business (Maheshwari, Gupta and Li, 2018). With this aspect, the present report undertakes listing requirements of ASX and NSX. Furthermore, it will explain different types of ASX and NSX with its importance indices as per investor’s point of view.
A .Listing requirements for the ASX and NSX
ASX consider their rules to set out requirements. These requirements ensure that there is quality of the market where ASX operates. Therefore, following are such requirements in the company:
Minimum requirements is 300
Company size based on profit and assets test. As per profit test aggregate amount of profit considered from continuing operations over 3 years with adding A$500,000. As per assets test, either A$ million on net tangible assets or A$15 million on market capitalization.
In this aspect, there is no working capital required if people seeking admission under profit test (Goodwin and Routledge, 2019).
In this list, there is a requirement of financial reporting on a half year and annual basis within Australia.
- from this, in NSX there are other listing requirements considered that explained under here:
- 50 or more Security holders must be in the primary class.
- 25% of issued capital held among the public hand (Hsiao and Liu, 2017).
- Capitalization of market listed securities at least on AUD $500,000
- Two-year adequate trading track record offer is underwritten in the minimum subscription.
Further, NSX offers two choices in listing routes such as capital raising and no capital raising.As per capital rising, there is disclosure documents provide investors with detailed information for making informed investment decisions. However, in no capital, the rising document provides potential investors with detailed information to make informed investment decisions (Cereola, Nichols and Street, 2018).
From the present analysis, it can be stated that in ASX exchange has more stringent listing requirements.
B. Kinds of indices in ASX and NSX and its importance
In Australia stock exchange and NSX, there are different kinds of indices and it is considered important in terms of different investor’s points of view (Basnarkov, Stojkoski, and Kocarev, 2020).
Capitalization Indices: This index is a more widely used and known form in the equity market. Capitalization indices also represent the sum of capitalization that exists in the market of different companies which helps to make the index. Changes in value reflect aggregate capitalization as their prices change continuously (Devereux and Smith, 2018).
Franking Credit Adjusted Indices: According to these indices, it can be stated that there is provide a measure of Australian equities after-tax performances. It assists in the gauge of tax effectiveness and superannuation portfolio.
Fixed Income Indices: This kind of indices helps to measure bond performances and short term money market. This determine the benchmark which designed to measure performance to meet with investable criteria (Rout, Hota and Karmakar, 2019).
Residential property indices: Property indices generally similar to other asset performance indices in Australia. In this aspect, changes measure within the market as identify the value of the asset class. It also commonly used to measure the historical return and risk of particular properties at a given location over time. As per these property indices define interest to mortgage lenders, existing potential property owners, developers, economists, etc. (Baikie, Stern and Jensen, 2018).
NSX All Equities Index: In this regard, all kinds of equities index consider which helps to increase profitability in the economy perspective.
NSX All property Index: It considers different kinds of property investments that include land, building, etc. In this regard, companies of the Australian market demonstrate their perfect benchmark that helps to lead with positive success.
NSX All Technology index: In this aspect, there are different kinds of technology index must be determined for aggregate capitalization (Goodwin and Routledge, 2019).
From an investor’s point of view, it can be stated that ASX is one of the important considerations. In this regard, they have several benefits with shares of ASX because they have part ownership of the business. They are also real time dealing throughout the trading day with limit orders available when markets are generally closed. Furthermore, they perceive the ability to vote on an important decision within the company (Maheshwari, Gupta and Li, 2018).
C. Three financial products trading in ASX
To trading in ASX, it can be stated that shared may be one of the simple financial product which considers different characteristics as well. They are explained under here:
Ordinary shares: Most of the shares that traded on ASX are ordinary shares which carry no special rights. Holders have the right to vote in a general meeting and participate in dividend distribution (Rout, Hota, and Karmakar, 2019). In this consideration, risk and return are generally higher. As the company gets more risk, it is getting more returns. Key features of these shares defined as the distribution of assets on winding up any enterprise on the same basis as other ordinary shareholders. There are no sub-categories of each product in this kind of share.
Preference shares: Preference shares generally give their holder priority over ordinary shareholders for payment of either dividend or winning company. With different kinds of preference shares, each person has different rights and characteristics. Holders of shares have voting rights that are restricted in particular circumstances. There are different terms also included in this kind of shares. In this kind of aspect, low risk and low return because, voting rights of holders are restricted (Maheshwari, Gupta, and Li, 2018). A key feature of these shares can be defined as the terms and conditions that are related to existing shares.
Partly paid shares: Partially paid shares issued without any company requiring payment at full issue price. On the specified future date, the company entitled to call for its remaining price. Furthermore, shareholders are obliged to pay their cal prices. There is low risk with low returns. This is because when companies call for their shares if they don’t get the amount of particular call they lose only a few amounts. The key feature of this share considers as a holder of partly paid share has the same right as an ordinary shareholder.
D. Overview of ASX
ASX is one of the world’s largest leading financial market exchanges. It is generally operated with a wide range of assets which involves equities, fixed income, commodities, and many others. It is one of the top global security exchanges in terms of value and there is the largest interest rate derivative in Asia. They provide a full suite of different services that involve listings, trading, clearing, settlement, information services, etc. Network and data center are generally connected with leading financial hubs. They operate in a world-class regulatory environment with global standards (Goodwin and Routledge, 2019).
The ASX group generally origin as a national stock exchange that started in 1987. In Australia, they consider different legislations which enabled six independent state-based stock exchanges. Parliament of the country also drafted legislation that enabled it. Nowadays, they launched a new group of structure that helps to make a better position in the environment of the financial market. ASX is long and full consideration of the world firsts with new technologies. It also underpinned with determination to find better ways in services within the market that strengthen the confidence of investor (History of ASX, 2019).
ASX deals in different categories that help to lead with the development of organisation with classification standards. It is important to deal with the development of the Australian Stock Exchange with categorizing companies. There are 11 sectors. 24 industry groups, 68 industries, and 157 sub-industries. Therefore, it assists to set more standards within the organization that lead with positive results. For instance. ASX considers its industry categorization in energy, consumer discretionary, and industrials, health care, financial, technology, utilities, communication, etc. Hence, they can develop several operations that assist to lead with several companies. In the above sectors, there are several companies listed in ASX.
In the ASX, there are 200 companies listed so that in this consideration different benchmark helps to index the Australian market. Therefore, it can be stated that all companies belong to different sectors such as finance, health care, medical, education, etc. (Maheshwari, Gupta and Li, 2018).
From the present study, it can be summarised that comparative analysis considers effective consideration within different sectors. In this regard, the present study considers discussion on ASX and NSX that is exchanged as per different aspects of sectors. Therefore, the report concluded about listing requirements of both exchanges in which ASX one of the best considerations in the Australia market. Furthermore, the report articulated different indices that included in ASX and NSX. However, as per the investor point of view ASX is the best in term of different indices that help to categories aspects which show for different companies. Moreover, there are different products of ASX explained that it considers the important role in Australian market.
Books and Journals
Baikie, T., Stern, T. and Jensen, M., 2018. A Framework for Responsive Market Regulation. Global Algorithmic Capital Markets: High Frequency Trading, Dark Pools, and Regulatory Challenges, p.332.
Basnarkov, L., Stojkoski, V. and Kocarev, L., 2020. Lead–lag relationships in foreign exchange markets. Physica A: Statistical Mechanics and its Applications, 539, p.122986.
Cereola, S.J., Nichols, N.B. and Street, D.L., 2018. The predictive ability of entity-wide geographic sales disclosures: IAS 14R versus IFRS 8. Research in Accounting Regulation, 30(2), pp.121-130.
Devereux, M.B. and Smith, G.W., 2018. Commodity Currencies and Monetary Policy (No. w25076). National Bureau of Economic Research.
Goodwin, J. and Routledge, J., 2019. Determinants of the Duration of Insolvency Administration: An Unconditional Quantile Regression Analysis. Available at SSRN 3403984.
Hsiao, Y. and Liu, C., 2017, July. The Impact of Financial Crisis of 2007 to 14 on the Australian Financial Firms. In 2017 2nd International Conference on Politics, Economics and Law (ICPEL 2017). Atlantis Press.
Maheshwari, S., Gupta, R. and Li, J., 2018. A Comparative Analysis of Sector Diversification in Australia, India and China.
Rout, M., Hota, S.S. and Karmakar, A., 2019. Prediction of impact response of delaminated pretwisted stiffened shell. Australian Journal of Mechanical Engineering, pp.1-13.
History of ASX. 2019. [Online] Available through: