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All change for your FTSE trackers

FTSE 100 tracker funds will no longer have exposure to Morrisons and FTSE 250 index trackers will hold more investment trusts
December 9, 2015

If you own a FTSE 100 tracker fund you will no longer own Morrisons (MRW), G4S (GFS) or Meggitt (MGGT) after 21 December 2015, following their demotion from the top UK index at this month's quarterly review. All three have lost their places in the benchmark index following a period of underperformance and been demoted to the FTSE 250.

Morrisons, which currently has a market cap of around £3.51bn, has seen its share price fall by around 17 per cent in the year to 2 December, when it was removed from the index. It has been shifted into the FTSE 250, triggering sales by trackers that follow the FTSE 100 and purchases by those that buy the FTSE 250.

The market was not surprised by the move, as Morrisons had hovered close to demotion during the June and September reviews. The supermarket has been hit by price competition among discount supermarkets and was forced to sell off a string of lossmaking stores earlier this year.

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