Thursday, June 22, 2017 4:12 PM EDT
The 4th time was the charm for mainland Chinese stocks which were rejected from MSCI for the past three years. MSCI announced that domestic Chinese stocks will be included in MSCI's global emerging-market index for the first time -- inclusion will begin in 2018. It is largely a symbolic victory for China as they will finally be included in the popular MSCI indices but with just a 0.7% weighting.
It may surprise many investors to learn that stocks from mainland China aren't included in the MSCI stock market indices despite having the Shanghai (#5 largest stock exchange) and Shenzhen (#8) stock exchanges comprise almost $7 trillion in market capitalization. These two exchanges combined are the 2nd biggest after the US and they are also home to many of the small and mid-sized company that align with China's consumer and service industries. Note that MSCI has included Chinese companies listed in Hong Kong and ADRs from the US like Alibaba.
MSCI applauded China's efforts to improve accessibility and relax control over index-linked investment products and signaled that it's open to a bigger role for Chinese A shares if China further liberalizes its financial markets. MSCI CEO Henry Fernandez said, "We'd like to expand the universe of shares that are available to international investors.
Disclosure: Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no ...
more
Disclosure: Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Runnymede Capital Management, Inc.), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Runnymede Capital Management, Inc. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Runnymede Capital Management, Inc. is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of Runnymede Capital Management, Inc.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.
less
How did you like this article? Let us know so we can better customize your reading experience.