MSCI

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MSCI
Msci logo.jpg
Key People Henry A. Fernandez, CEO and Chairman
Products Indices and performance analytics
Website www.msci.com

MSCI is a provider of investment decision tools to investment institutions worldwide. MSCI products include indices and portfolio risk and performance analytics for use in managing equity, fixed income and multi-asset class portfolios.

MSCI calculates over 100,000 equity, REIT and hedge fund indices daily. Since MSCI global equity benchmarks were first launched in 1968, estimated assets benchmarked to MSCI indices have grown to over USD 12 trillion.[1][2] In addition to benchmarking and performance measurement, MSCI indices are increasingly being integrated into other areas such as research and asset allocation, and used as the basis of derivative products.

In Q3 2017, data showed that 99 of the top 100 global investment managers were clients of MSCI.[3]

Key Events

The MSCI name was formed in 1986, when investment bank Morgan Stanley obtained licensing rights on Capital International Indices, a set of global stock market indices for non-US markets that had been published since 1968. In 1998, the unit was separated into MSCI, Inc.

In 2004 MSCI acquired Barra, a risk management and portfolio analytics firm.[4]

In 2007, MSCI Barra was spun off from Morgan Stanley in an IPO, listed on the NYSE under the ticker symbol MSCI.

In June 2010, MSCI acquired RiskMetrics Group, a firm specializing in credit and market risk analytics, in a deal valued at approximately $1.55 billion.[5] Later that year, MSCI acquired Measurisk, a risk measurement too set for the hedge fund community. The platform is now called the MSCI RiskMetrics HedgePlatform.

On July 12, 2010, it was announced that NYSE Euronext would be the only U.S. exchange to offer MSCI-linked stock index futures. MSCI said that other contracts listed in the U.S. under its existing licenses would cease trading by June 17, 2011. [6] On or before this date, futures on two of MSCI's most widely tracked global benchmarks, MSCI Emerging Markets and MSCI EAFE, would cease trading on CME Group and migrate to NYSE Liffe U.S.[7]

MSCI acquired IPD, a real estate performance measurement group, in November 2012 to help expand MSCI's ability to incorporate real estate into its models.[8]

Two months after the IPD acquisition, MSCI bought InvestorForce, a company that made reporting software for institutional investment consultants, for $23.5 million.[9]

In March 2013, NYSE Liffe and MSCI extended their licensing agreement through November 1, 2021.[10]

MSCI then bought GMI Ratings for $15 million in the summer of 2014. GMI focused on corporate governance research and ratings and was incorporated into MSCI's ESG (Environmental, Social and Governance) Research unit.[11]

On December 10, 2014 CBOE Holdings announced a licensing agreement with MSCI Inc. to offer options trading on several MSCI indexes exclusively on the CBOE. The six indexes included in the agreement are the MSCI EAFE Index, MSCI Emerging Markets Index, MSCI ACWI Index, MSCI USA Index, MSCI World Index and the MSCI ACWI ex-USA Index. CBOE offered options trading in the first quarter of 2015 on the MSCI EAFE Index and the MSCI Emerging Markets Index, two of MSCI's best-known indexes. The exchange later listed options on the four other MSCI Indexes in 2015.[12]

MSCI acquired Insignis, a financial data aggregation company, for an undisclosed sum in October 2015.[13]

In June of 2017 MSCI decided to add China A-shares (stocks denominated in yuan and listed in either Shanghai or Shenzhen) to its Emerging Markets Index after having rejected the shares in each of the past three years. MSCI in the past cited concerns over the openness and transparency of Chinese markets for the rejection.[14]

Indexes

The MSCI US Broad Market Index represents approximately 99% of the capitalization of the US equity market. It is the aggregation of the MSCI US Investable Market 2500 and the Micro Cap Indices. The MSCI US Broad Market Index represents a greater proportion of the US equity market cap than the most commonly used broad market indices.[15]

The MSCI EAFE Index (Europe, Australasia, Far East) is a free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the US and Canada. As of 2017, the MSCI EAFE Index consisted of the following 21 developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. [16]

The MSCI Emerging Markets Index was launched in 1988. Since then the MSCI Emerging Markets (EM) Indices have evolved considerably over time, moving from about 1% of the global equity opportunity set in 1988 to 10% in 2017. Today the MSCI Emerging Markets Indices cover securities in 24 markets that are currently classified as EM countries. The EM equity universe spans large, mid and small cap securities and can be segmented across styles.[17]

For a full list of indices offered, go here.

Key People

References

  1. Index Licensing. MSCI.
  2. Assets in Equity ETFs Linked to MSCI Indexes Reach All - Time High of $511 Billion. MSCI.
  3. Our Story. MSCI.
  4. About Us. MSCI Barra.
  5. MSCI To Acquire RiskMetrics Group. Automated Trader.
  6. NYSE Liffe U.S. to Become Sole U.S. Exchange for MSCI-Based Futures. NYSE website.
  7. Press Release. NYSE Euronext.
  8. MSCI to Acquire the IPD Group. MSCI.
  9. MSCI to Acquire InvestorForce. MSCI.
  10. NYSE Liffe U.S. and MSCI Extend Index Licensing Agreement. NYSE Euronext.
  11. MSCI buying GMI Ratings to integrate ESG and accounting research. Pensions and Investments.
  12. CBOE Enters into Agreement with MSCI Inc. to List Index Options. CBOE.
  13. MSCI Acquires Data Aggregator Insignis. CBOE.
  14. MSCI to Add China Shares to Indexes, Opening Market to More Foreign Investors. The Wall Street Journal.
  15. US Equity Indexes. MSCI Barra.
  16. MSCI Regional Equity Indices. MSCI.
  17. MSCI Emerging Markets Indices. MSCI.