Wed, Aug 15, 2018 - Page 12 News List

MSCI reduces Taiwan’s weighting in several indices

Staff writer, with CNA

Global index provider MSCI Inc has cut Taiwan’s weighting in its Emerging Markets Index and the All-Country Asia ex-Japan Index, while leaving the nation’s weighting in the All-Country World Index unchanged.

The weighting changes came after a quarterly index review.

Data compiled by Yuanta Securities Investment Trust Co (元大投信) showed that MSCI lowered Taiwan’s weighting in the Emerging Markets Index, which is closely watched by foreign institutional investors when shaping strategies for emerging markets, from 11.79 percent to 11.71 percent.

MSCI also lowered Taiwan’s weighting in the All-Country Asia ex-Japan Index from 13.5 percent to 13.39 percent, but its weighting in the All-Country World Index remained unchanged at 1.35 percent.

Lin Liang-yi (林良一), manager of the Yuanta P-shares MSCI Taiwan ETF Fund, said Taiwan’s 0.08 percentage point decline was the steepest among the markets covered by the MSCI Emerging Markets Index, while China posted the biggest increase of 0.37 percentage points.

China’s increased weighting came after MSCI included more Chinese yuan-denominated A-shares in its index, which led to weighting cuts not only for Taiwan, but many other emerging markets as well.

The cuts in Taiwan’s weightings in the MSCI indices were widely expected and were therefore not likely to have much of an effect on the local stock market, Lin said.

The TAIEX yesterday ended up 0.7 percent to 10,824.23 points, taking cues from global bourses that somewhat steadied from a plunge in the Turkish lira.

Despite the index adjustments for Taiwan, no individual Taiwanese stocks were removed from or added to the MSCI Global Standard and the MSCI Global Small Cap indices.

However, some had their weightings changed in the MSCI Taiwan Index of local stocks.

The adjustments are to take effect after the local stock market closes on Aug. 31, MSCI said.

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