The Japan Exchange Group (JPX) will reduce the number of companies in the TOPIX stock index by 40%, cutting 683 constituents to 986. The move, effective October 30, 2026, aims to enhance the index's investability and pressure companies to improve governance.
The TOPIX index revamp aims to improve its investability by removing illiquid stocks, potentially attracting more foreign investment and pressuring remaining companies to enhance their corporate governance and market appeal.
The Japan Exchange Group (JPX) is set to implement a significant overhaul of the TOPIX stock market index, reducing its constituents by approximately 40%. The move will cut the number of companies from 1,636 to 986, with 683 companies slated for removal under tougher inclusion rules. This initiative, announced on October 7, 2026, is the second stage of a multiyear effort by the JPX, which operates the Tokyo Stock Exchange, to enhance the index's investability. Historically, the TOPIX has included a large number of relatively illiquid small-cap companies, a characteristic the JPX aims to address.
The changes are scheduled to begin taking effect on October 30, 2026. JPX Market Innovation & Research, Inc. (JPXI), which calculates and publishes the indices, has announced the results of its periodic review and initial selection of constituents. Constituents subject to transitional measures are scheduled for re-evaluation in October 2027.
Pick the topics you care about. Get only what matters, on your cadence.
