For instance, FTSE, Chicago’s Center for Research in Security Prices (CRSP) and MSCI differ in their views on emerging market status. South Korea has about a 16% weighting in MSCI’s emerging markets, whereas South Korea is considered a developed market in FTSE and CRSP. [Does the ETF Index Provider Matter?]
“The decision forces ETF Strategists and financial advisors to review their South Korea exposures and, depending upon their client allocation, could force investment decisions that otherwise they would not have had to make that ultimately is a franchise risk for Vanguard,” Weiskopf added.
For more information on ETF indexing, visit our indexing category.
Max Chen contributed to this article.