The S&P/ASX All Technology Index (All Tech Index), launched in partnership with S&P Dow Jones Indices, will go live on Monday under the ticker XTX.

The new index includes ASX-listed companies in the technology sector, starting with 46 members holding a combined market capitalization of around $104 billion.

At the top of the constituents are accounting software provider Xero, share transfer company Computershare and buy-now-pay-later giant Afterpay. Pension fund services provider Link Administration also made the top 10.

At launch, the index included three New Zealand companies, two from the US and one Irish company.

Max Cunningham, executive general manager, listing and issuer services at the ASX, commented that he expected more foreign listings to come, adding that one of the most important factors attracting foreign firms to the ASX was the local pension system.

"Given the recent listings we had in December and a very robust plan for 2020, this part of the cohort is likely to increase," Mr Cunningham said.

“Our pension fund now stands at $2 trillion and is projected to grow to $10 trillion by the middle of the next decade. This currently makes us the fourth largest investable pension fund in the world.

"And if the demographics stay as they are through the middle of the decade, we should be number two in the world for investable pension funds globally, not per capita, mind you, but in total absolute dollar value."

There are currently more than 200 technology companies listed on the ASX, valued at almost $115 billion.

The index provides early entry for ASX-listed technology companies, with a floating adjusted minimum market capitalization of $120 million, several hundred million lower than the current qualifying value for the S&P/ASX 300.

Also, there is no set number of ingredients; its composition may change at each quarterly rebalance.

BetaShares is the first provider to launch an ETF tracking the index, a week and a half after its launch.

ASX CEO and Managing Director Dominic Stevens said the index would improve the profile and understanding of Australia's listed technology companies and increase opportunities for investors.

"We've seen a huge increase in the number of technology companies listed on the ASX and the quality of their performance recently," Mr Stevens said.

"Over the past three years, the annualized total return from the S&P/ASX 200 has been around 10 per cent, while the return from the new All Tech Index over the same period - it existed - would have been over 20 per cent."

“The All Tech Index recognizes the critical mass of technology companies listed on the ASX. It provides investors with an opportunity to see how the sector is tracking and gives them a benchmark against which to measure its performance.”

Mr Stevens added that a vibrant technology sector was good for Australia.

"This helps drive economic growth, strengthens the relevance of our capital markets and promotes job creation and innovation on the coast," he said.

Sarah Simpkins

Sarah Simpkins is a journalist at Momentum Media, reporting mainly on banking, financial services and wealth.

Prior to joining the team in 2018, Sarah worked in commercial media and produced stories for a current affairs program on public radio.

You can contact her at [email protected].