Three Companies Now Drive 70% of the ZSE's Top 10 Index

Three Companies Now Drive 70% of the ZSE's Top 10 Index — What That Means for Diversification The ZSE's index reshuffle looks like routine housekeeping. Underneath it is a market getting more concentrated, not more diverse — and that has real consequences for anyone relying on an index to spread their risk. The numbers, plainly According to Equity Axis, three counters now account for more than 70% of the Top 10 Index's underlying value, including Econet Wireless Zimbabwe and Delta Corporation. The Top 15 Index is similarly skewed. In the first-quarter 2026 index review, Ecocash Holdings and Hippo Valley Estates left the Top 10, replaced by First Mutual Properties and Tigere Property Fund REIT. Zimbabwe Now reports that property-linked counters — Tigere Property Fund REIT, Mashonaland Holdings and First Mutual Properties — now make up roughly 30% of the Top 10 Index. Why it happened / the mechanism An index is a basket of companies used to measure the market. The Top 10 Index is meant to represent the largest and most important counters, but representation isn't the same as diversification. If three companies drive most of the value, the index's movement really reflects those three, not the broader market. Think of a fruit basket meant to represent "fruit in general," but three-quarters of its weight comes from just three apples. Whatever happens to those three apples — a good harvest, a bad one — dominates what the whole basket looks like, even though it's still technically labelled "fruit basket." Equity Axis reads the specific swap — Ecocash and Hippo Valley out, two property counters in — as a tilt toward property-backed, yield-oriented instruments and away from earnings-driven operating businesses. The more structural point is what Equity Axis calls a "structurally contracting" market: the index isn't being expanded by new listings or organic growth, it's being kept stable by reweighting the same smaller pool of existing companies. Why this matters If you buy an index-tracking product, you're not buying a slice of the whole economy — you're buying a basket that leans heavily on a handful of names. When one heavyweight falls, everyone tracking the index feels it. When new companies don't arrive to list, the index keeps recycling the same counters rather than genuinely growing. What does this mean for the common person If you or your pension holds ZSE index-tracking investments: it's worth understanding that your exposure is more concentrated than the word "index" might suggest. Three companies driving 70% of the Top 10's value means your returns are really tied to those three, not a broad cross-section of the economy. If you're thinking about diversification: a narrow listed market is a real reason some investors look beyond listed equity entirely — toward property-backed instruments, or assets whose value is tied to something real and tangible rather than to a handful of share prices. If you're evaluating any fund or index product: the practical lesson here applies well beyond the ZSE — check what's actually inside a fund or index before assuming the name tells you how diversified it is. For everyone: this doesn't mean the ZSE is a bad market or that its strong recent performance (covered elsewhere) isn't real. It means the strength is sitting on a narrower base than the headline "market is up" framing suggests. Keep the scale in mind The "over 70%" figure comes mainly from one research house, Equity Axis, and the ZSE's own published index composition wasn't directly quoted in the reporting behind this story. Treat it as a well-sourced estimate rather than an official, independently verified number. Concentration can also reverse — if new companies list, or credible capital raises bring fresh names into contention, the index could genuinely broaden again rather than just being reshuffled among the same players. Closing takeaway The ZSE's recent index changes aren't a sign of the market growing wider — they're a sign of a smaller room being rearranged. That distinction matters more than the headline numbers: a market can look active on the surface through index reshuffles and strong returns while the underlying pool of genuinely available, diversified investment options stays narrow. Understanding which one you're looking at is the more useful question than the percentage itself. This article is for information only and is not investment advice.