What is the MSCI Philippines Index?

There was an interesting post at the Pinoy Money Talk Facebook page the other day about the MSCI Philippine Index.

A few months ago there was some fuss about restructuring of the index, resulting in sell-offs by traders on the excluded companies.

MSCI Philippines Index stands for MorganStanley Capital International Philippines Index.

Morgan Stanley is an investment bank.

Google/Wikipedia says,

MSCI Inc. is a US-based provider of equity, fixed income, and hedge fund indices, and equity portfolio analysis tools. It is best known for publishing the MSCI World and MSCI EAFE Indices. Wikipedia

An index is simply a basket or collection of securities to which a comparison of performance is based on. It also serves as a model portfolio of "safe stocks" to invest in.

The MSCI Philippines index is said to comprise 85% of the entire "Philippine stock universe".

Pinoy Money Talked also compared the performance of the Morgan Stanley Capital International Philippine Index with the PSEi or Philippine Stock Exchange Index and MSCI Phils index outperformed the PSEi.

They are also saying that the MSCI Phils. Index is at par with most UITFs and Mutual Funds. 

Hence, they are suggesting it is worth a look to anyone who's looking for a suitable model portfolio.

Read the full article here:

http://www.pinoymoneytalk.com/msci-philippines-index-composition-february-2014/

For me, as a value investor, I try to avoid stocks which are regarded as "blue-chip" for the reason that most of these are overpriced. Companies in this index are usually oversubscribed and prices are pushed up by the hot money of foreign investors. In my viewpoint, bargains will not be found in this list, unless a massive sell-off ensues.

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