The addition of mainland China’s A-shares to the MSCI Emerging Markets Index next month could attract $40 billion of capital into the country’s stock markets, says Jing Ulrich, vice chairman of JPMorgan Asia Pacific.
By including 230 A-shares on their Emerging Markets Index, US-based MSCI Inc. are opening up the yuan-denominated stocks to both passive and active traders across the world. JPMorgan believes the move could bring in $6.6 billion from passive investors, and five times more from active.
A-shares will have a 0.8% weighting in the index, currently tracked by $11 trillion of global institutional funds, reports Caixin Global.