The Hindu Business Line : iShares MSCI India debuts on Singapore Stock Exchange

iShares MSCI India, the MSCI India Index tracker ETF, was listed on the Singapore Stock Exchange today with a strong gain. It closed at $3.80, up 2.2 per cent over its opening price of $3.72.

Managed by Barclays Global Investors (BGI), part of Barclays Plc, iShares MSCI India is a sub-fund of the iShares Southeast Asia Trust, which seeks to provide an investment return that corresponds generally to the performance of a diversified portfolio of Indian stocks as measured by the MSCI India Index, through holding Indian Access Products, issued by a connected entity of a registered FII in India as underlying investments.

iShares ETFs

This open-ended ETF would allow exposure to top Indian stocks without having to own the underlying index components. Traded through brokers, this would be a cheaper alternative to traditional funds for absence of front-loading.

BGI, which manages $1.5 trillion of assets, has globally collected about $45 billion of fresh money for its iShares ETFs in 2006, almost the same amount it collected in the whole of 2005.

There are more than 160 iShares trading on over 10 stock exchanges around the world. iShares MSCI India is denominated in US dollars and would seek results that generally correspond to the MSCI India Index, subject to currency movement. It holds a basket of Indian Access Product as security (such as a warrant, note or participation certificate) linked to an Indian stock; and the Index Return Indian Access Product is linked to the MSCI India Index. Both securities synthetically replicate the economic benefit of the relevant stock or the Index that trades in India, according BGI. Both IAPs and Index Return IAPs are denominated in US dollar and listed in Luxembourg.

iShares MSCI India reinvests cash dividends (if any) on an ongoing basis, and may make annual income distribution to unit-holders. The MSCI India Index was originally designed as a benchmark representing Indian listed companies. It is free-float adjusted, calculated in rupee terms.

Index constituents

As on 30 April 2006, the Index comprised 64 stocks with the largest 10 constituent stocks represented in excess of 55 per cent of the total market capitalisation, based on total shares in issue, of the Index.

The MSCI Single Country Standard Equity Indices, of which MSCI India Index is one of them, generally seeks to have 85 per cent of the free float-adjusted market capitalisation of each industry group in each market.

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