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MSCI / FTSE Russell to drop US Sanctioned Companies from Indexes

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  1. #1

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    MSCI / FTSE Russell to drop US Sanctioned Companies from Indexes


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    the bigger issue (For me and other investors looking for increased transparency) is China's refusal to allow of audit oversight for companies listed on US exchanges
    Why is it even an issue? They've never allowed overseas audits and yet people who have wanted to invest have invested. People who have not, have not.

    As an asset class (chinese shares) or individual stocks - you can find replacements if you don't want to accept the current transparency.

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    Quote Originally Posted by shri:
    Why is it even an issue? They've never allowed overseas audits and yet people who have wanted to invest have invested. People who have not, have not.

    As an asset class (chinese shares) or individual stocks - you can find replacements if you don't want to accept the current transparency.
    It’s also about the quality of a market,
    you would not expect/ accept rotten food
    in a deli.

    That’s why there are different market places for shares, and OTC has a role
    Insomnia and East_coast like this.

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    Quote Originally Posted by shri:
    Why is it even an issue? They've never allowed overseas audits and yet people who have wanted to invest have invested. People who have not, have not.
    Easy solution to that: If you don't want to play by the rules, have all Chinese companies delist overseas and allow overseas investors to directly purchase their shares at the Shanghai Exchange instead. I bet prices would be way lower without the veneer of respectability Chinese companies gain from being listed in mature markets.
    shri, traineeinvestor and huja like this.

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    Quote Originally Posted by shri:
    Why is it even an issue? They've never allowed overseas audits and yet people who have wanted to invest have invested. People who have not, have not.

    As an asset class (chinese shares) or individual stocks - you can find replacements if you don't want to accept the current transparency.
    The stock exchange usually has rules that need to be met as a basis for the risk investors are taking on.

    There should be a seperate international market for firms that want non-China investment but wont play by international auditing norms - Or will that be HK's new role?

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    Quote Originally Posted by East_coast:
    The stock exchange usually has rules that need to be met as a basis for the risk investors are taking on.
    Are you saying that investors were not aware any time over say the last 5 years that there might be some problems with some of the stocks?

    And more importantly, were the index licensing companies also not aware of these issues when they included certain markets and stocks in their indexes?

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    Quote Originally Posted by shri:
    Are you saying that investors were not aware any time over say the last 5 years that there might be some problems with some of the stocks?
    No

    Quote Originally Posted by shri:
    And more importantly, were the index licensing companies also not aware of these issues when they included certain markets and stocks in their indexes?
    No

    but given the increasing perceived instability of China it could be that the lines need to be moved to assure the ongoing quality of the service (trading reputable stocks) levels offered.

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    What increased instability? (OK... I will stop here...)


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    Quote Originally Posted by shri:
    Are you saying that investors were not aware any time over say the last 5 years that there might be some problems with some of the stocks?

    And more importantly, were the index licensing companies also not aware of these issues when they included certain markets and stocks in their indexes?
    They're obviously all ignorant and naïve investors. /s

    I agree with you, this is a nothing burger.

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