MSCI

Singapore sovereign wealth funds.

Yeah, Singapore pressure MSCI to downgrade them.

Which I don't think we have that power.

Every time we escalate, right, it's a show of hands.

Asian technology hardware stocks offer a lower risk way to invest in AI compared to some US tech stocks.

Isn't that changing now here in Singapore? Because we can look at four ETFs that track S&P 500, the S&P 500 equal weight, NASDAQ 100, MSCI world indices during SGX trading hours.

So there are more options for retail investors?

Yes, there are more options today.

Yeah.

When it comes to Japan, Japan is not in our benchmark.

We follow the MSCI Asia Pacific ex-Japan benchmark.

But when we do look at Japan, because it's clearly a large economy within Asia, we think that the domestic economy is not as exciting to us as the economies of Australia or Singapore when we think about developed markets in Asia.

Asian technology hardware stocks offer a lower risk way to invest in AI compared to some US tech stocks.

Isn't that changing now here in Singapore? Because we can look at four ETFs that track S&P 500, the S&P 500 equal weight, NASDAQ 100, MSCI world indices during SGX trading hours.

So there are more options for retail investors?

Yes, there are more options today.

Yeah.

When it comes to Japan, Japan is not in our benchmark.

We follow the MSCI Asia Pacific ex-Japan benchmark.

But when we do look at Japan, because it's clearly a large economy within Asia, we think that the domestic economy is not as exciting to us as the economies of Australia or Singapore when we think about developed markets in Asia.

No, it is not.

And what we call is, of course, the risk of Indonesia, Indonesia's stock market to be downgrade, that's what it's called, or MSCI calls the frontier market, meaning it's sort of the level below the middle market.

And that would mean that a lot, as basically maybe almost all international investors would simply leave the stock market.

Now, why are we touching base again? Because it is actually, it's a bit on the front again.

So we can only recommend to spend some time on the team.

And it's been up again for discussion the past 10 days.

The trigger was actually on Friday the 16th of October, a big drop in the stock market in Indonesia again, as MSCI was hitting out one more time at the poor country and basically just repeating the probability of Indonesia being now a frontier market in the future.

Wasn't a surprise.

So we'll just talk about the DATs for a moment.

The MSCI has come out and they have basically said, They have a number of companies which don't meet their index measures.

So a company can't be in its indexes if it lacks substantial operating assets and fails at least four of their five financial tests.

We won't go through all those.

But what it means is that on the 11th of November, the MSCI is publishing a final list of the companies impacted.

One of those companies, could be strategy.

Now, the impact that that would have on strategy, really on the 30th of November, there would be several things that happen.

SK Hynix rose 4.6% after jumping 11% a day earlier.

MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.7%.

while Japan's Nikkei fluctuated between gains and losses and was last up 1%.

China's blue-chip index fell 0.8% and Hong Kong's Hang Seng index rose 0.5%.

So it raised the deposit facility rate to attract inflows and it cut the rupiah reserve requirement to release some liquidity into the system.

Nonetheless, Indonesian assets remain under heavy selling pressure, with equities taking a further hit after MSCI threatened a two-step downgrade from its current emerging market status to stand-alone status.

So if that is done, that would actually exclude Indonesia from a lot of major equity benchmarks.

And what about South Korea? The central bank's been in the news there.

Do you think it's justified to downgrade them to standalone, basically putting them in the same category as Palestine and Lebanon and Argentina? Is that a bit of

overkill? MSCI, I keep telling myself I've got to do a blog and do more research into how they make their decisions.

To me, I think they're making their decisions based more on liquidity than than quantity, than quality.

You know, in fact, one reason I started the fund is because I didn't like the stocks and their indexes and their ETFs.

SK Hynix rose 4.6% after jumping 11% a day earlier.

MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.7%.

while Japan's Nikkei fluctuated between gains and losses and was last up 1%.

China's blue-chip index fell 0.8% and Hong Kong's Hang Seng index rose 0.5%.