China’s equities will finally be opened up to a whole new world of foreign investors via the MSCI Inc. decision. But are they ready?
Dominated by retail investors and periodically pushed around by the ever-hovering hand of the state, the $6.9 trillion mainland market may be a culture shock for the pension funds and institutions that track MSCI’s benchmarks. The New York-based index compiler rejected China three times before agreeing to admit 222 mostly big-cap stocks Wednesday, with issues to do with Beijing’s control of the market at the top of their list of concerns.