Introducing the S&P/JPX Prime Market 250 Index: A Japanese Take on the S&P 500^®

S&P Dow Jones Indices (S&P DJI) and the Japan Exchange Group (JPX) have jointly developed the S&P/JPX Prime Market 250 Index—the first index focused on companies that are members of the Tokyo Stock Exchange (TSE) Prime Market that is designed for global investors.  Launched Dec. 9, 2024, the index comprises a broad range of 250 Japanese large- and mid-cap companies that meet size, liquidity, profitability and sector diversification requirements.

Incorporating many of the same key methodology principles as the widely followed S&P 500, the S&P/JPX Prime Market 250 Index could well be seen as a “Japanese version” of  The 500™.

What is the Prime Market?

The Japanese stock market was restructured in 2022, shifting from four market divisions to three, now including the newly formed Prime Market, as well as Standard and Growth Markets.

This restructuring aimed to better define the concept of each market division, reduce overlap between the markets and provide incentive for companies to sustainably increase corporate value.

The TSE Prime Market has minimum market cap, public float and business performance criteria to distinguish itself from the Standard Market.  For example, to be eligible for being listed on the Prime Market, companies must achieve a total profit for the most recent two-year period of at least JPY 2.5 billion, or sales of at least JPY 10 billion combined with a market cap of at least JPY 100 billion (see Exhibit 1).

As of Dec. 31, 2024, there were 1,636 companies that met this Prime Market listing criteria.  These companies are included in the TSE Prime Market Index, which serves as the selection universe for the S&P/JPX Prime Market 250 Index.

S&P/JPX Prime Market 250 Index Methodology Summary

The S&P/JPX Prime Market 250 Index is intended for foreign market participants and foreign-registered investment-linked products.  The index is weighted by float market capitalization, which includes adjustments for foreign ownership restrictions.  The S&P/JPX Prime Market 250 Index constituents are leading companies in the Japanese equity market, selected on the basis of size, liquidity and GICS^® sector representation.

As well as being a member of the TSE Prime Market, eligible constituents in the index universe must achieve a positive quarterly earnings per share (EPS) at least once in the past four quarters.

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