CRSP US All Market Index

The MSCI US Index is a securities index compiled by Morgan Stanley Capital International (MSCI) and represents the overall performance of the US stock market. The index covers approximately 85% of the free-floating market capitalization of the United States and includes approximately 630 listed companies covering multiple industries and sectors.

The MSCI US Index is an important indicator that global investors pay attention to because it reflects the trend of the US economy and the risk-return characteristics of the market. Many funds and ETFs use the MSCI US Index as a benchmark or tracking object, such as iShares Core S&P 500 ETF (IVV), Vanguard Total Stock Market ETF (VTI), etc.

History and Evolution of the MSCI US Index

The predecessor of the MSCI US Index was the Capital International Global Stock Index created by Capital International in 1969. At that time, it only included stock indexes from 15 developed markets.

In 1986, Morgan Stanley obtained the index authorization from Capital International and established the index as the Morgan Stanley Capital International (MSCI) Index. By the 1980s, before FTSE, Citibank and S&P joined the ranks, the MSCI index was the main benchmark outside the United States.

In 1994, MSCI began to provide stock indexes for emerging markets and frontier markets to meet investors' needs for global diversified investment portfolios. In 1998, MSCI collaborated with Dow Jones to launch a series of Industry Classification Standards (GICS) for systematic classification and analysis of global stocks.

In 2000, MSCI merged its equity index business with Barclays Global Investor Services to form MSCI Barclays, which was listed on the New York Stock Exchange in 2007.

In 2009, MSCI acquired RiskMetrics, a provider of risk management and portfolio analysis services, and changed its name to MSCI in 2010.

In 2014, MSCI acquired IPD Group, a provider of real estate analysis and benchmarking services, and integrated its real estate business into its subsidiary MSCI Real Estate.

Features and Benefits of the MSCI US Index

The MSCI US Index has the following characteristics and advantages:

Broad representation: The MSCI US Index covers most of the market capitalization of the US stock market and includes multiple industries and sectors, which can reflect the overall status of the US economy and the diversified characteristics of the market.

High quality standards: The MSCI US Index adopts strict stock selection standards and regular review mechanisms to ensure that index constituent stocks have a high degree of free float, investability and transparency, and comply with internationally recognized financial reporting and governance norms.

Global consistency: The MSCI US Index uses the same methodology and structure as the MSCI stock indexes in other regions and countries, and follows the unified industry classification standard (GICS), allowing investors to easily make cross-market and cross-industry comparisons. and analysis.

Widely used: The MSCI US Index is a benchmark or tracking object widely used by global investors. Many funds and ETFs use this index as the basis for their investment strategies or performance evaluations, and the index has also been cited in many academic studies and media reports.

MSCI US Index Investment Approach and Risks

Investors can invest in the MSCI US Index through the following methods:

Direct investment: Investors can directly buy the constituent stocks of the MSCI US Index and allocate them according to their weight in the index, thereby achieving the same or close returns as the index. This method requires investors to have sufficient funds and time to execute transactions and adjust the portfolio, and needs to bear expenses such as transaction costs and taxes.

Indirect investment: Investors can indirectly buy funds or ETFs that use the MSCI US Index as a benchmark or tracking object, thereby realizing returns related to the index. This method does not require investors to execute transactions and adjust portfolios themselves, but is done by the managers of funds or ETFs, thus saving transaction costs and time. However, investors pay management fees for the fund or ETF and may face tracking errors between the fund or ETF and the index.