FTFM Emerging market equity indices have evolved in the past 20 years, providing greater liquidity, a broad range of countries and regions for investors who want to move outside domestic or developed markets, and ease of access.
When MSCI Barra, an index provider that has been in the business more than 40 years, launched the MSCI Emerging Market Index in 1988 it represented only about 1 per cent of the All Countries World Index (Acwi) – a combination of developing and developed markets. “Since then we have seen tremendous growth. Today it represents about 12 per cent of the Acwi,” says Dimitris Melas, head of Europe, Middle East and Africa applied research at MSCI Barra. Institutional investor appetite to extend portfolios across borders or to measure investment performance against more far-flung benchmarks has triggered an exponential growth in the number of emerging market indices. These focus on single countries such as Korea, Taiwan or China or cover wider regions such as the Middle East or Africa. Thomson Reuters, a new player in the indices business, has just brought out a new regional index for European emerging markets.
