Brazilian BDRs Allowed Up to 10% in Ibovespa by 2027
The Brazilian stock exchange has revised its main index methodology, permitting Brazilian Depositary Receipts to comprise up to 10% of the Ibovespa starting in the first half of 2027.
On February 8, the Brazilian stock exchange, B3, announced a significant update to the rules governing the Ibovespa, the country's primary stock market index. This rule change allows Brazilian Depositary Receipts (BDRs)—securities representing shares of Brazilian companies traded abroad—to be included in the index composition. The new methodology will take effect during the first six months of 2027. According to the B3, this adjustment follows years of market evolution where investors increasingly access national companies through both local listings and foreign-traded receipts, which have seen consistent growth in liquidity and usage. The exchange stated that discussions with market participants led to this decision aimed at preserving the index's relevance for products like ETFs, funds, and derivatives. However, inclusion is not automatic for all BDRs. Companies must still meet traditional criteria regarding liquidity, tradability, and representation. Furthermore, the combined weight of all BDRs in the index will be capped at 10% of the theoretical portfolio to maintain alignment with investment fund regulations.
