A-shares weighting set to be raised 
2019-08-27
Three leading global index compilers are all going to raise the weighting of Chinese A-shares in their global indices in the next 30 days, which is estimated to bring additional funds of over US$36 billion into the A-share markets.
MSCI Inc is to increase the inclusion factor for China’s A-shares in its MSCI Emerging Markets Indexes. 
For 260 existing China A-share constituents, the inclusion factor will be increased from 10 percent to 15 percent from close today.
This is estimated to bring additional US$22.7 billion funds into the A-share markets, according to a report by China International Capital Corp, while China Merchants Securities expected the passive funds to flow in A-shares reaching US$36 billion.
Another index provider FTSE Russell announced its plans to raise the weighting of Chinese A-shares in one of its benchmark global indexes last week. 
The inclusion factor for China A-share constituents will be lifted to 15 percent from 5 percent, with 79 stocks getting included in the FTSE Global Equity Index Series. Among them, there will be 14 large-cap stocks, 15 mid-caps, 50 small-caps and eight micro-cap shares.
This inclusion will be effective from September 23, which is expected to bring an addition of around US$4 billion of funds from passive investors into the A-share markets, according to FTSE Russell.
This is the second tranche of FTSE Russell’s three-step timeline for the first phase of A-share inclusion, which first started on June 24 and will be completed on March 23 next year. 
The first phase will add 25 percent of the investable market cap of eligible large-, mid-, and small-cap China A-shares to FTSE GEIS and derived indexes.
Meanwhile, S&P Dow Jones Indices will include Chinese A-shares in its global benchmarks also starting from September 23 and the list of stocks to be incorporated will be released on September 6. 
