The expansion, contemplated for years, got a push in reaction to the collapse of German payments company Wirecard, which dramatically fell from grace in 2020, just two years after promotion to the benchmark index.
A bigger index means greater diversific
ation and potentially more stability for investors. Graphic: DAX's climb,
The move promotes an array of companies to an index previously reserved for German corporate titans like Volkswagen and Siemens.
Other new entrants include the plane manufacturer Airbus and the online fashion retailer Zalando.
The changes are effective on Monday, Sept. 20.
Wirecard's demise embarrassed the German government and stained the nation's reputation as a safe haven investment, accelerating the reform imitative backed by Deutsche Boerse Chief Executive Officer Theodor Weimer.
Deutsche Boerse announced the overhaul plans last November, saying the changes would improve quality of the DAX indexes and align them with international standards..
Over the past year, Deutsche Boerse has also imposed more stringent membership criteria in financial reporting and profitability.
Manfred Schlumberger, portfolio manager at Starcapital, said he doubted the expansion would make the index more attractive.
U.S. indexes are more attractive than their European counterparts because they have a high portion of future-oriented industries like technology and communication, he said.
"The DAX doesn't get that through the overhaul because those industries simply don't exist here," he said
The remaining new entrants include: health technology company Siemens Healthineers, flavour and fragrance maker Symrise, lab equipment maker Sartorius, chemicals distributor Brenntag, meal-kit company Hellofresh, and genetic testing specialist Qiagen.
The number of constituents in the mid-cap index will shrink to 50 from 60.
(Reporting by Tom Sims and Hakan Ersen; Editing by Chris Reese and David Gregorio)
By Tom Sims and Hakan Ersen