The MOZY v the OZZY

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Wednesday 8 September 2004

Tower appears to be taking the threat of the NZX-promoted MOZY passive fund seriously, as it has sent an email to brokers outlining the key differences between the fund and one of its own.

By The Landlord

Tower has the listed Tortis- OZZY fund which tracks the 20 largest companies on the Australian stock exchange, while NZX has launched the MOZY fund which tracks the ASX MidCap 50 index comprising the 51st to 100th biggest Australian companies.

One of the key differences is that the average size of a top 20 company is A$19,776 million, compared to A$1,605 million.

The argument about size and composition is that larger companies are more mature, while mid-cap companies fall into the growth category.

Also, Tower argues, that once a company is in the top 20 it is likely to stay there, while the composition of the MidCap index is more likely to change.

“The Leaders 20 could be said to be biased towards capturing and retaining the companies that grow their way to the top end of the market, whereas the MidCap 50 is a transition zone for companies with that type of growth trend.”

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