Indexes for distinct investment strategies
Our Strategy Indexes are designed for use in connection with certain investment approaches, such as hedged indexes for use with portfolios managing equity and currency exposures or capped indexes for use with portfolios subject to concentration restrictions imposed by regulatory requirements.
Most MSCI Indexes are traditional market cap weighted indexes, where each constituent is weighted by its free float-adjusted market capitalization. In certain cases, this can result in single stock, sector or geographical concentrations as a company, sector or region grows in value and, by extension, influence on index performance. Our Capped Indexes provide an alternative construction methodology to address this issue.
Standard MSCI Capped Indexes limit index concentration by constraining various sector, geographical or constituent weights to a preset maximum.
MSCI 10/40 Equity Indexes apply UCITS requirements to MSCI standard, value & growth and small cap equity indexes.
MSCI 25/50 Indexes apply US Internal Revenue Code investment constraints for a fund to qualify as a regulated investment company (RIC) in the US.
MSCI Hedging & Currency Indexes
Currency movements can have significant impact on global equity index performance and volatility. These indexes reflect the effects of certain hedging activities and currency performance.
MSCI Hedged & Daily Hedged Indexes reflect the performance of a parent MSCI Index with currency risk hedged back to a single “home country” currency (monthly and daily hedging versions, either fully or partially hedged, available).
MSCI FX Hedge Indexes aim to reflect the performance of a currency hedge on a parent MSCI Regional Index, excluding equity market performance.
MSCI Global Currency Indexes aim to reflect the currency performance, plus accrued interest from holding the currencies for a parent MSCI Regional Index.
MSCI Short & Leveraged Indexes reflect the performance effects of daily shorting and leveraged investment strategies.
MSCI Short Daily Indexes reflect the performance of the four main return components of daily shorting investment strategies: capital gains associated with the underlying securities, cash dividends paid by the underlying securities, interest earned on initial capital and short sale proceeds, and stock borrowing costs.
MSCI Leveraged Daily Indexes reflect performance of the three main return components of daily leveraged investment strategies: capital gains associated with the underlying securities, cash dividends paid by the underlying securities and interest paid to the capital lender.
MSCI Equal Sector Weighted Indexes equally reweight the sectors of a parent MSCI index at each rebalance, to help avoid potential sector concentration.
MSCI Equal Country Weighted Indexes equally reweight the country exposures of a parent MSCI regional index at each rebalance, to help avoid potential country concentration.
- Asset allocation: Flexibility to set specific parameters around regional and security exposures, as well as analyze certain effects of different investment strategies.
- Performance measurement and attribution: Highly diverse set of benchmarks to accommodate a broad spectrum of investment mandates.
- Research: A trusted source for data for sell-side research.
- Investment product development: May be licensed to serve as the basis for structured products and other index-linked investment vehicles, such as ETFs and ETNs.