The IBRX, or Brazil 100 Index, in lose translation, is a price index measuring the profits of a theoretical stock portfolio composed by the 100 most traded stocks in the Brazilian Stock Exchange – both in number of trades as well as in financial volume. The IBRX was started in January 2nd, 1997, and the significance of each stock inside the index – for calculation purposes – may be altered throughout the due period of the portfolio according to price changes or to the distribution of dividends of each stock.
The imaginary portfolio is reset every four months, considering the periods between January through April, May through August and September through December. When the time comes for re-evaluation, stocks must meet the following criteria to be included in the IBRX:
- To be among the 100 most traded stocks over the 12 months preceding the insertion;
- Having participated in at least 70% of the trading sessions over the same period.
If a stock no longer satisfies the above mentioned criteria, it will be excluded from the index. . Companies undergoing administration, bankruptcy procedures of facing special situations, or those that have had their trading suspended for a long period will also be removed from the index.
The Brazilian Stock Exchange calculates the IBRX in real time, considering prices of the last trades made in the spot market (standard lot) with the stock included in the index.
Some examples of stocks in the IBRX are: Natura, Petrobras, Vale, Gerdau, Fibria, among others.
The IBRX-50 is very similar to the IBRX. However, it will focus exclusively on the 50 most traded stocks both in number of trades as well as in financial volume. This index was started in 2003, and the only change from the original index is the number of stocks that integrate it.
The IBRX-50 also presents a few advantages over the original IBRX: this index was conceived to be a reference base for investors and portfolio managers, as well as to allow for derivatives to be issued: such as futures, future options and index options.
To compose the index, stocks must fill a specific set of criteria:
- Being one of the 50 most traded stocks over the 12 months preceding the insertion;
- Having participated in at least 80% of the trading sessions over the same period.
As with the IBRX, if a stock stops meeting any of the criteria listed, it will be excluded. Other exclusion situations follow the same parameters that the IBRX does.
Among the stock included in the index, we can point as examples: Bradesco, Cielo, Usiminas, Vale and Petrobras.