Announcement for April 15, 2021 at 08:23 PM GMT
THIS IS AN ANNOUNCEMENT FOR THE MSCI GLOBAL STANDARD INDEXES
CONCLUSIONS FROM THE CONSULTATION ON A TREATMENT OF POTENTIAL INDEX ADDITIONS WITH EXTREME PRICE INCREASE
(Re: Announcement sent on February 1, 2021 with Sequence number : 00101.ALL)
MSCI announced today the conclusions from its recent consultation with the investment community on a treatment of potential index additions with extreme price increase.
Following positive feedback from the investment community, starting from the May 2021 Semi-Annual Index Review, MSCI will employ additional screening for potential additions and size-migrations to the Standard Indexes of the MSCI Global Investable Market Indexes (GIMI).
More specifically, securities that exhibit extreme price increase will not be eligible for addition (or migration) into the Standard Indexes. Such securities would be re-evaluated for Standard Index inclusion in the subsequent Index Review using Standard Index inclusion criteria, including the return-based thresholds for extreme price increase.
As a reminder, the central aim of this change is to employ a sufficient time period to allow for potential stabilization of price discovery for securities exhibiting exceptionally high price returns and to reduce the scope for potential reverse turnover. This will build upon the existing seasoning treatment that MSCI applies for all but large initial public offerings (IPOs), as defined in the MSCI GIMI methodology.
This treatment will initially only apply to potential additions to the MSCI Standard Indexes. MSCI may consider extending such treatment to MSCI Small Cap Indexes in the future. Any changes to the treatment will be communicated accordingly.
The updated MSCI GIMI Methodology book reflecting this methodology change is available on MSCI's website: https://www.msci.com/index-methodology
THIS IS AN ANNOUNCEMENT FOR THE MSCI GLOBAL STANDARD INDEXES
End of announcement.
Further announcements may occur as needed.
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