MSCI Client-Designed Indexes intro

What are Client-Designed Indexes?

MSCI has an extensive product range to help address investors’ needs. Additionally, we are well-positioned to support the increasingly complex needs of our clients by enabling client-designed solutions. While our index offering is extensive, institutions may wish to license a custom index that incorporates their criteria.

With the MSCI Client-Designed Indexes, institutions can tap into the full scope of our advanced indexing resources and extensive data, while specifying their unique index requirements.

Leveraging on 50+ years of leadership in index design, the MSCI Client-Designed Indexes use the same index construction, maintenance infrastructure, and robust data sets that institutions have come to expect from our core index offerings.


Client-Designed Indexes Intro

Key benefits

  • Broad coverage

    Ability to customize any MSCI index, including Market Cap, Thematic, ESG and Climate indexes, to incorporate client-specific benchmark or portfolio requirements.

  • Data reliability

    Well-established, reliable index production process – the same used for calculating all MSCI indexes.

  • Rigorous methodology

    Replicable and transparent indexes designed with the same rigorous calculation and maintenance methodology that institutions have come to expect from our core index offerings.

  • Global support

    Cross-functional team of custom index experts in Research, Index Production, IT and Product Management.

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Client-Designed Indexes - how are indexes constructed

How Client-Designed Indexes are constructed

  1. Institutional investors define their index needs and requirements

     

  2. MSCI incorporates those requirements into index design criteria, potentially generating several new indexes

     

  3. Institutional investors review the output and decide which index best meets their needs


Client-Designed Indexes - selection criteria

Selection criteria

Institutions can choose from a wide range of criteria to build their client-designed index including:

  • Security weights (market-cap-weighted, equal-weighted and capped weights as examples)
  • Security types
  • Currency and hedging ratios
  • Liquidity metrics
  • Rebalance dates
  • Exclusions (for example, sectors, countries, ESG criteria and fundamental metrics)


MSCI Client-Designed Indexes Methodology

Index Methodology

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MSCI Client-Designed Indexes use cases

Uses for Client-Designed Indexes

Better align policy benchmark and portfolio indexes with an index that more accurately reflects investment strategy constraints.

Carry out performance analysis and attribution for institutional currency overlay mandates.

Leverage MSCI’s calculation of specialized in-house indexes.

Incorporate capping criteria to help comply with regulatory guidelines.

Construct and issue index-linked products to meet specific investment strategies.

Apply differentiated investability and liquidity criteria.

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