For managers of global index portfolios this week, a big issue is whether or not MSCI will add China A-Shares to the MSCI Emerging Markets Index (MXEF). MSCI plans to announce its 2017 Market Classification Review on Tuesday, June 20, shortly after 4:30 p.m. ET.
A June 17 headline to a Barron’s story speculated …
“Will China Gain Entry to MSCI Indexes? The giant indexer has said no three years in a row, but this time may be different. Approval would offer a nice boost to China’s capital levels.”
And a June 15 headline for a story in the Financial Times noted …
“Defining moment for investors looms as MSCI rules on China. Index provider set to make call on including mainland A-shares in its EM benchmark.”
The MSCI Emerging Markets Index
The MSCI Emerging Markets Index captures large- and midcap representation across 23 emerging market (EM) countries. As of May 31, the index had a total aggregate market capitalization of more than $4 trillion and 830 constituent stocks.
Recent Price Performance
The MSCI Emerging Markets Index has performed well so far in 2017. As shown in the chart below, from January 6 through June 16, the total return (pretax with reinvested dividends) version of the MSCI Emerging Markets Index rose 15%, higher than some other well-known indexes.