IShares MSCI Germany Index Fund (EWG) Short Interest Update

IShares MSCI Germany Index Fund (EWG) Short Interest Update

Aside from the effect on A-shares themselves, the other area of impact for investors is in the makeup of funds that track MSCI's indices, especially the MSCI Emerging Markets Index. Index providers typically adjust or rebalance their indices periodically to reflect underlying market developments. The Index consists of stocks traded primarily on the Mexican Stock Exchange.

"Index inclusion will bring more long-term institutional investors into the A-shares market.which will change the market structure", Shi said, noting that the market is now dominated by retail investors. Royal Bank of Canada now owns 343,128 shares of the exchange traded fund's stock valued at $10,994,000 after acquiring an additional 100,056 shares during the period. "The more global investors participate, the more they see it (investing in A shares) works and gain positive experience from it, and the more they will invest".

In addition, active managers that have identified opportunities in China A-shares have already set their allocations to the share class.

After years of anticipation, MSCI has finally taken the plunge. Without giving any definitive timetable, Pettit also suggested a full inclusion of A shares is possible in future.

Chin Ping Chia, head of research for Asia-Pacific at MSCI, says the initial inclusion of A-shares into the MSCI Emerging Markets Index will only increase China's proportion of the index by 0.8% to a 31.3% weighting.

More than 200 Chinese companies debuted Friday in MSCI equity indices in what analysts call a small yet significant step in China's cautious drive to integrate with world markets and tame the volatile "casino" atmosphere of its stock exchanges. "But it shows us a clear roadmap that the index will gradually add a bigger exposure of A-shares".

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NYSEARCA:EWJ opened at $59.74 on Friday. iShares MSCI Japan ETF has a fifty-two week low of $52.81 and a fifty-two week high of $64.71.

"The mainland market, which is largely dominated by retail investors, remains very momentum-driven", Lam explained.

"MSCI inclusion may have unintentionally reduced China Inc's pressure to reform". Their long-term investing strategies and fundamentally-driven approach will change the market structure.

Citigroup Inc. trimmed its stake in shares of iShares MSCI EMU Index (BATS:EZU) by 86.7% in the 1st quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. "A better corporate governance standard in these Chinese enterprises would certainly reduce the duration and the frequency of the mandatory suspension".

Why did it take so long?

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