Originally Posted by
Muse
The point I was getting at was the NZX board was like the wild west in the 1980s, with a different market structure, behaviour and regulatory environment relative to today.
While the NZX50 is capped at - you guessed it - 50 - there were a lot more companies on the NZX. The nzx website shows 131 companies listed on the NZX (excludes funds). Haven't bothered to count the number with a primary listing here so by the time you take away the thinly NZX traded ANZ, westpacs, downers and the like the underlying number a bit lower.
By comparison there were more than 200 companies IPO'd from 1983 to 1987 - more IPOs than the entire number of NZX listed firms today! Then you have the existing companies already listed in addition to the 200 new IPOs and you get a have a bigger number of constituents. There was a lot of mania and skullduggery associated with the IPOs and the behaviour & market trends distorted the nzx50 as well as the general board. So while we followed the overseas trends with the big crash in the 80s we had a lot of own goals in making our crash more severe and long lasting relative to the american experience, if my memory serves me right.