Market Classification

MSCI announces the results of the 2021 annual market classification review

On June 24, 2021, MSCI announced the reclassification of the MSCI Argentina Index from Emerging Market to Standalone Market Status. Additionally, on September 7, 2021, MSCI announced the reclassification of the MSCI Pakistan Index from Emerging Markets to Frontier Markets.

Results of the MSCI 2021 global market accessibility review

On June 10, 2021, MSCI announced the results of the 2021 Global Market Accessibility Review. Following the announcement of the 2021 Annual Market Classification Review, the detailed report of the MSCI 2021 Global Market Accessibility Review originally released last June 10, 2021, now includes the assessment on Argentina, thereby covering 84 markets.

The results of the MSCI Global Market Accessibility Review are announced prior to the communication of the MSCI Annual Market Classification Review in June of each year.

The table below reflects the currently effective classification of markets. Please refer to the latest Annual Market Classification Review and press release for details.

1 The MSCI Standalone Market Indexes are not included in the MSCI Emerging Markets Index or MSCI Frontier Markets Index. However, these indexes use either the Emerging Markets or the Frontier Markets methodological criteria concerning size and liquidity.

2 The West African Economic and Monetary Union (WAEMU) consists of the following countries: Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. Currently the MSCI WAEMU Indexes include securities classified in Benin, Senegal, Ivory Coast and Burkina Faso.

 

Why a country's market classification may matter to investors

Every June, MSCI announces the results of its evaluation of the equity markets for countries around the world, to determine each country’s classification as a developed, emerging, frontier or standalone market. An important component of MSCI’s decisions is investors’ experience of market accessibility, rather than merely an abstract analysis of regulatory language. MSCI is careful not to force a decision that may take market participants by surprise.

The Annual Market Classification Review is designed to ensure that MSCI indexes remain relevant and precise investment decision support tools for clients, and continue to accurately represent the equity markets they are measuring.

For example: market accessibility can be overlooked, such that a country with an advanced economy and several world class companies may not necessarily equate to a sufficiently advanced market, when objectively compared to other markets (a frequent misconception).

 

The MSCI market classification framework

The Annual Market Classification Review is based on the MSCI Market Classification Framework , which aims to reflect the views and practices of the international investment community by striking a balance between a country’s economic development and the accessibility of its market while preserving index stability. The framework consists of the following criteria:

  • Economic development: Considers the sustainability of economic development and is only used in determining the classification of developed markets, given the wide range of development levels within emerging and frontier markets
  • Size and liquidity requirements: Determines those securities that meet the minimum investability requirements of the MSCI Global Standard Indexes
  • Market accessibility criteria: Aims to reflect international institutional investors’ experiences of investing in a given market and includes five criteria: openness to foreign ownership, ease of capital inflows / outflows, efficiency of operational framework, availability of investment instruments and stability of the institutional framework

June 2021 MSCI Global Market Accessibility Review Report

June 2021 MSCI Market Accessibility Country Comparison Report

As part of the annual market classification announcement, MSCI communicates the list of countries currently under review and the new list of countries, if any, under review for potential market reclassification in the upcoming cycle.


Past market reclassifications:

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Country IndexesMarket ReclassificationDate*
MSCI Iceland IndexFrom Standalone to Frontier MarketsMay 2021
MSCI Lebanon IndexFrom Frontier Markets to Standalone MarketsFebruary 2021
MSCI Kuwait IndexFrom Frontier Markets to Emerging MarketsNovember 2020
MSCI Saudi Arabia IndexFrom Standalone to Emerging MarketsMay 2019
MSCI Argentina IndexFrom Frontier Markets to Emerging MarketsMay 2019
MSCI China IndexChina-A Shares included in the Emerging MarketsMay 2018
MSCI Pakistan IndexFrom Frontier Markets to Emerging MarketsMay 2017
MSCI WAEMU IndexFrom Standalone to Frontier MarketsNovember 2016
MSCI Bulgaria Index                     From Frontier Markets to Standalone                                  

August 2016

MSCI Ukraine IndexFrom Frontier Markets to StandaloneAugust 2015
MSCI Qatar IndexFrom Frontier to Emerging MarketsMay 2014
MSCI UAE IndexFrom Frontier to Emerging MarketsMay 2014
MSCI Greece IndexFrom Developed to Emerging MarketsNovember 2013
MSCI Morocco IndexFrom Emerging to Frontier MarketsNovember 2013
MSCI Trinidad & Tobago Index**From Frontier Markets to StandaloneMay 2011
MSCI Israel IndexFrom Emerging to Developed MarketsMay 2010
MSCI Bangladesh IndexFrom Standalone to Frontier MarketsMay 2010
MSCI Argentina IndexFrom Emerging to Frontier MarketsMay 2009
MSCI Pakistan Index***From Standalone to Frontier MarketsMay 2009
MSCI Jordan IndexFrom Emerging to Frontier MarketsNovember 2008
MSCI Lithuania IndexFrom Standalone to Frontier MarketsNovember 2008
MSCI Serbia IndexFrom Standalone to Frontier MarketsNovember 2008
MSCI Sri Lanka****From Standalone to Frontier MarketsNovember 2007
MSCI Venezuela Index*****From Emerging to StandaloneMay 2006
MSCI Greece IndexFrom Emerging to Developed MarketsMay 2001
MSCI Portugal IndexFrom Emerging to Developed MarketsNovember 1997

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*As of the close of the last business day of the month except for MSCI Saudi Arabia and MSCI Argentina Index.

**Trinidad and Tobago was added to the MSCI Frontier Markets Index in May 2009

***Pakistan was removed from the MSCI Emerging Market Index in December 2008 and maintained as a standalone country index

****Sri Lanka was removed from the MSCI Emerging Market Index in June 2001 and maintained as a standalone country index

*****Index was discontinued on January 2, 2008


MSCI market classification framework

MSCI market classification framework

The classification of markets is a key input in the process of index construction as it drives the composition of the investment opportunity sets to be represented.

MSCI Country Classification Standard

MSCI Country Classification Standard

Easy access to the MSCI country classifications for the MSCI universe of equity securities.

MSCI global market accessibility review

MSCI global market accessibility review

Country Comparison covering Developed Markets, Emerging Markets, Frontier Markets and Standalone Markets for June 2021.

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