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China A-Shares: Is Your Emerging-Market Manager Ready?

By Advisor Perspectives
Wealth Management, Asset Management


As the Chinese New Year approaches, investors will welcome the year of China A-shares, soon to be included in the MSCI emerging-market (EM) benchmarks. But put careful consideration into determining which funds are actually ready to join the festivities.

Index provider MSCI plans a gradual integration for the vast onshore market, whose $8.3 trillion market capitalization is second only to that of the US. Though A-shares will initially account for just 0.7% of the MSCI Emerging Markets Index, it’s a major step toward assimilating China’s vast onshore equity universe into global capital markets. At full inclusion of 500 stocks, A-shares are likely to account for more than 20% of the benchmark, according to many sell-side estimates. Over the long term, the index revisions are expected to unleash $100 billion of investment in A-shares through EM vehicles.

Read more at Advisor Perspectives.

Photo: Abriga Media

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