MSCI, the global index provider, announced its February 2025 quarterly index adjustments, which will take effect after the close on February 28, 2025. The MSCI Global Equity Index will add 23 securities and remove 107. The largest additions by market capitalization are United Airlines, Reddit, and Natera. In the MSCI Emerging Markets Index, the top additions include Hyundai Motor India, Emaar Development, and J&T Express.
The MSCI China Index will see the addition of eight stocks, including Hangzhou Hikvision Digital Technology, Supply and Marketing Daji, Canadian Solar, J&T Express, Runhe Software, Crystal Integrated Circuit, Sichuan Changhong, and Yonghui Superstores. Meanwhile, it will remove 20 stocks, such as Anjoy Foods, Antu Biotech, Bloomage BioTechnology, Kailaiying, and Huayang Co.
The MSCI China A Onshore Index also underwent changes, adding stocks like Compass, Hangzhou Hikvision Digital Technology, Canadian Solar, Hunan Yuneng, Runhe Software, Qilu Bank, and Megmeet. It removed 10 stocks, including Foton Motor, Xinhua Cement, BGI Genomics, and Venustech.
MSCI conducts routine adjustments to its indices four times a year, with major reviews in May and November and smaller updates in February and August. These adjustments are based on quantitative criteria like market capitalization and liquidity.
Historically, passive funds adjust their holdings on the last day to minimize tracking errors, often leading to significant trading volume changes in affected stocks. Active funds have more flexibility in timing their adjustments. Investors are advised to monitor stocks with lower liquidity for potential impacts.
