Voya Asia Pacific High Dividend Equity Income Fund T.IAE

Seems like it was a cross for index transfer

[KeithR39]

from Urraca on a UK board:

Ithaca is moving to the MSCI small cap index, presumably from the MSCI micro cap index. While small cap tracker funds will be buying in, the micro cap tracker funds will be selling out. So how will the buys and sells balance out? On 16 Nov, Billfish posted this on the III Spund Energy chat board, as Sou is also moving index.

Hi Gemmel1,
The two share prices are easy to explain.

82.5 is the closing price while 80.37 is the delayed publication of a trade that actually took place at 8:47 which involved the transfer of 192,00 shares for £154,656.

This is not uncommon when, as now, institutions are unloading shares as they do not want to disturb the price until they have completed the exercise.

The above statement will no doubt raise a few eyebrows so I had better explain.

Today it was announced that Sound energy had been promoted from the MSCI UK Mico Cap Index to the MSCI UK Small Cap Index.

In effect this means that Sound will go from being a big fish ( in fact the biggest fish) in a small pond to being a much smaller fish in a much bigger pond.

While those fund managers that are measured against the Small Cap Index will be accumulating the shares those that are measured against the Micro Index will be selling and recycling the cash among the other constituents of that index.

The latest publication of the Micro Index show that Sound constitute 1.19% of that index.

https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&ved=0ahUKEwidhPLX9KjQAhWdOsAKHTLGAJ4QFggvMAM&url=https%3A%2F%2Fwww.msci.com%2Fdocuments%2F10199%2Fb8252f33-2482-4961-afb1-5deae71efe24&usg=AFQjCNFgGGvUxSLvM5ReNjhqcTEUN5eqvQ&sig2=TKNFq4py1HIZFMywE-EOgg&cad=rja

Sound have not yet been added to the Small Cap index so we need a proxy (a share of similar value that is included in the index) to estimate how what percentage of that index will be accounted for by the addition of Sound Energy.

On OCT 26th Sound shares were worth 82.75 and it had a market cap of £464.4.
The closest share to Sound that is in the Small Cap index is SOCO International which had a market cap of £477.5 at the same time.

SOCO accounts for 0.1% of the index.

https://www.msci.com/constituents

So Sound has gone from being 1.19% of one index to 0.1% of another index.

If you had two funds of similar size, say £20m, one invested in micros and the other in small caps, the micro fund would have £238,000 invested in Sound while the Small Cap fund would have £20,000.

All things being equal,you can see that the selling pressure of the micros is almost 12 times the buying demand of the small caps.

The other thing to note is that the micro managers are unlikely to ignore Sound as it was the largest constituent of that index while, at 0.1% of the small cap index, Sound is not so important for those fund managers to hold.

This is just a side issue this week as we await the results of the st


source:
https://www.lse.co.uk/ShareChat.asp?page=2&ShareTicker=IAE