Taipei Times - archives
I heard in passing last night that MSCI may drop Taiwan from its global indices. The issue involves some sort of dispute over how Taiwan futures are settled in Singapore. I don't get it either.
If Taiwan is dropped it would mean a lot of global money benchmarked to Taiwan would sell out because they would no longer be benchmarked to the country.
I think there is very little chance of this happening but if you have exposure to Taiwan you should pay attention to this.
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2 comments:
Roger is not blowing smoke here; I have lived through two large benchmark switches (the Irish market in the year after EMU when the domestic managers' benchmark changed from the local market to the MSCI Europe, and Portgual's change from MSCI Emerging to MSCI Developed) and both of them were worth twelve months of pure pain. This isn't like a one-off, over in a month S&P500 addition or deletion; MSCI changes cause big, serious, long term money flows.
-dsquared
dsquared,
thanks for the nod!
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