nen part of the s&p/asx 300 index, page-7

BPAA,

I believe that there are rules within which many of the funds have to opperate. I don't disagree with you that many of them are exceptionally ordinary but as for the range of companies that some of them are allowed to invest in, well thats not necessarily completely upto them.

Depending on the fund type and its mandate the allocation of funds to companies outside the asx 50/100/200/300 etc has to be limited due to percieved risk. There are loads of companies outside these lists that compete for the limited quantities of investment that are available for riskier investment.

Making it into these indexes means that the company is on a list which has a greater pool of available investment funds and slightly more conservative funds can start to look at it. Once the company get onto the 200 list the pool of funds is larger again and so on.

In some cases moving onto a list means that some funds go from "not allowed to invest in it" to "have to invest in it". Some funds will have to start selling the stocks that got dropped from the lists. Those funds need to be reinvested and NEN will inevitably get its share of that liquidity.