MSCI adds Chinese 'A-shares'

Investors will gain access to previously restricted Chinese equities, following the addition of new stock options to MSCI indices. 

Index provider MSCI announced in a statement on Tuesday that 234 Chinese stocks would be included on its China Index, Emerging Markets Index and Global Standard Index from 31 May.

The companies will represent aggregate weights of 1.26 per cent on the MSCI China Index and the MSCI Emerging Markets Index, respectively.

Among the 234 Chinese companies are Air China, China Eastern Airlines, Bank of China, Kweichow Moutai and Tsingtao Brewer.

In a statement, Fidelity International portfolio manager Raymond Ma welcomed the news and said the inclusion of these “A-shares” would likely ramp up the “participation of foreign institutional investors”.

“In the medium to long term, this will help the A-share market to become more sophisticated, improve liquidity and see it increasingly driven by fundamentals rather than short-term market noise,” Mr Ma said.

Advertisement
Advertisement

He added that the Chinese A-share market was “primarily dominated by retail investors currently,” but MSCI’s inclusion looked set to raise the proportion of institutional investors over time.

MSCI adds Chinese 'A-shares'
default
ifa logo

Subscribe to the ifa bulletin

Receive daily online news,analysis, reports and business strategies
By signing up you agree to our Terms of Use and Privacy Policy

from the web

Website Notifications

Get notifications in real time and stay up to date with content that matters to you.