The BEL20 is the main stock market index of the Brussels Stock Exchange in Belgium. It was created in 1991 and is composed of the 20 most significant companies and enterprises listed on the Belgian market.

This index reflects the performance of the Belgian market and is weighted by market capitalization, which means that companies with a higher market capitalization have a higher weight in the index.

Virtually all BEL20 companies pay dividends; some of the most prominent are Anheuser-Busch InBev, KBC Group, Proximus and others.

How is the BEL20 value calculated?

To determine the daily value of the BEL20 stock index, the following mathematical formula is used based on the capitalization of its component companies:

BEL20(t) = BEL20(t - 1) × Σ Capi(t) / [ Σ Capi(t - 1) ± J ]

In addition, an adjustment coefficient J is used to prevent financial transactions, such as capital increases or reductions, from drastically affecting the share price.

The value of BEL20 on day t is obtained by multiplying the value of BEL20 on the previous day (day t-1) by a percentage calculated from the sum of the capitalizations of the 20 companies on day t, divided by the sum of the capitalizations on day t-1.

It is important to understand that the daily capitalization of a specific company is calculated by multiplying the number of shares by the listed value of that company on that day.

For example, if today the BEL20 closed at 3,500 points, the total capitalization of the 20 companies today would be approximately 200 billion. If tomorrow the capitalization, at the close, amounted to 202.5 billion, the final close of the BEL20, tomorrow would be:

BEL20 (specific day) = 3,500 x 202.5/200 = 3,537.5 basis points.