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Consider the following statements regarding the Morgan Stanley Capital International (MSCI) Index:
- It facilitates the construction and monitoring of portfolios in a cohesive and complete manner.
- The Rural Electrification Corporation Limited has secured a place in this Index.
Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
Consider the following statements regarding the Morgan Stanley Capital...
Introduction:
The Morgan Stanley Capital International (MSCI) Index is a widely recognized global benchmark that tracks the performance of various equity markets. It is used by investors and fund managers to measure the performance of their portfolios and make investment decisions. In this question, we are asked to determine the correctness of two statements related to the MSCI Index.
Explanation:
Let's evaluate each statement separately:
Statement 1: It facilitates the construction and monitoring of portfolios in a cohesive and complete manner.
This statement is correct. The MSCI Index is designed to provide a comprehensive representation of the equity market in a particular country or region. It includes a broad range of companies from various sectors and industries, allowing investors to construct diversified portfolios. The index is regularly reviewed and rebalanced, ensuring that it remains representative of the underlying market.
Statement 2: The Rural Electrification Corporation Limited has secured a place in this Index.
This statement is also correct. The Rural Electrification Corporation Limited (REC) is a government-owned financial institution in India that provides funding for rural electrification projects. REC is listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) in India. The MSCI Index includes companies that meet specific criteria such as market capitalization, liquidity, and free float, among others. If REC meets these criteria, it can be included in the MSCI Index.
Conclusion:
Both statements are correct. The MSCI Index facilitates the construction and monitoring of portfolios in a cohesive and complete manner. The Rural Electrification Corporation Limited has secured a place in this Index.
The Morgan Stanley Capital International (MSCI) Index is a widely recognized global benchmark that tracks the performance of various equity markets. It is used by investors and fund managers to measure the performance of their portfolios and make investment decisions. In this question, we are asked to determine the correctness of two statements related to the MSCI Index.
Explanation:
Let's evaluate each statement separately:
Statement 1: It facilitates the construction and monitoring of portfolios in a cohesive and complete manner.
This statement is correct. The MSCI Index is designed to provide a comprehensive representation of the equity market in a particular country or region. It includes a broad range of companies from various sectors and industries, allowing investors to construct diversified portfolios. The index is regularly reviewed and rebalanced, ensuring that it remains representative of the underlying market.
Statement 2: The Rural Electrification Corporation Limited has secured a place in this Index.
This statement is also correct. The Rural Electrification Corporation Limited (REC) is a government-owned financial institution in India that provides funding for rural electrification projects. REC is listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) in India. The MSCI Index includes companies that meet specific criteria such as market capitalization, liquidity, and free float, among others. If REC meets these criteria, it can be included in the MSCI Index.
Conclusion:
Both statements are correct. The MSCI Index facilitates the construction and monitoring of portfolios in a cohesive and complete manner. The Rural Electrification Corporation Limited has secured a place in this Index.
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Community Answer
Consider the following statements regarding the Morgan Stanley Capital...
Rural Electrification Corporation Limited under the Ministry of Power, has secured a coveted place in the esteemed Morgan Stanley Capital International (MSCI) Global Standard Index, effective from 1st September 2023.
- It is owned by the multinational investment management and financial services company Morgan Stanley.
- It is an investment research firm that provides stock indexes, portfolio risk and performance analytics, and governance tools to institutional investors and hedge funds.
- It is a leading provider of critical decision support tools, including stock indexes, and services for the global investment community.
- MSCI indices facilitate the construction and monitoring of portfolios in a cohesive and complete manner, avoiding benchmark misfit. It has over 160,000 indices in its portfolio.
- MSCI has indexes for countries, regions, emerging markets, developed markets, small cap, all cap and even Islamic indexes.
- It selects stocks for its equity indexes that are easily traded and have high liquidity, with companies having high free float getting more weightage.
- It prefers stocks that have active investor participation, and are without owner restrictions.
Hence both statements are correct.
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Consider the following statements regarding the Morgan Stanley Capital International (MSCI) Index: It facilitates the construction and monitoring of portfolios in a cohesive and complete manner. The Rural Electrification Corporation Limited has secured a place in this Index.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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