MSCI’s inclusion of A-shares in the emerging markets index would be gradual, starting with 5% in 2015, according to the index provider. That would boost China’s weight in the index to 19.9% from the current level of 18.9% and if the country decides to fully liberalize its financial markets, it could account for 27.7% of the MSCI Emerging Markets Index.
As of March 12, China is the largest country weight in the iShares MSCI Emerging Markets ETF (NYSEArca: EEM) at 18.4%, 240 basis points ahead of second place South Korea, according to iShares data.
db X-trackers Harvest CSI 300 China A-Shares Fund
Tom Lydon’s clients own shares of EEM.