MSCI China A-share inclusion along the way of China’s transition to quality growth
Friday 01 June 2018
Research / Market
MSCI China A-share inclusion along the way of China’s transition to quality growth
- In June 2017, MSCI announced the partial inclusion of China’s domestically traded, yuan-denominated stocks, or so-called A-shares to MSCI China, MSCI Emerging Markets (EM), and MSCI All Country indices, which is to be implemented from June 2018.
- A-share inclusion was previously rejected in any indices due to limited market accessibility to global investors and restrictions on repatriation of capital, among others things. Then, the Chinese authority addressed these issues gradually, in particular by launching the Stock Connect schemes.
- At 5% inclusion factor,China A-Shares will account for roughly 0.8% of the MSCI EM Index, 1.1% of the MSCI Asia Index, and 0.1% of the MSCI AC World Index. The inclusion of China A-shares this year will take effect through a two-step process of 2.5% each, effective on June 1, 2018 and September 3, 2018.