Understand the Stock Market Indices
Investment Basics
Learn More About Investment
As you grow your investment knowledge, it’s important to understand the factors and methods affecting your investment choices.
Some of these can be controlled while others cannot – knowing the difference and what to do about these is a crucial step in crafting your investment strategy.
Understand the Stock Market Indices
World Market Indices
- FTSE Developed Net total return Index
- MSCI* World ESG Universal Select Business Screens Index
- MSCI* World Net Total Return USD Index
What are World Market Indices?
World market Indices are financial indicator that measures the performance of multiple stock markets from around the world. It provides a snapshot of the overall global equity market by tracking the performance of a broad range of companies across various countries and sectors.
Index performance
Source: MSCI & FTSE, data as of Sep 30, 2024.
Index performance base as 100. Past performance does not predict future returns. Investors cannot invest directly in an index. For illustration purpose only.
*Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability of fitness for a particular purpose with respect to any of such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI's express written consent.
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The FTSE Developed Index is a market-capitalization weighted index representing the performance of large and mid-cap companies in Developed markets. The index is derived from the FTSE Global Equity Index Series (GEIS), which covers 98% of the world’s investable market capitalization. (As of 30 Sep 2024)
Source: FTSE, data as of Sep 30, 2024.
For illustration purpose only.
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The MSCI* World ESG Universal Select Business Screens Index is based on the MSCI World Index, its parent index, and includes large and mid-cap securities across 23 Developed Markets countries. The index aims to represent the performance of a strategy that excludes companies that are associated with controversial weapons, nuclear weapons, oil sands or recreational cannabis; or derive revenues from conventional weapons, thermal coal, tobacco or civilian firearms; or are involved in very severe controversies pertaining to ESG issues; or have an MSCI ESG Rating of CCC.
Source: Bloomberg, data as of Sep 30, 2024.
For illustration purpose only.
*Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability of fitness for a particular purpose with respect to any of such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI's express written consent.
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The MSCI World Index captures large and mid-cap representation across 23 Developed Markets (DM) countries*. With 1,410 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country. (As of 30 Sep 2024)
*DM countries include: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the UK and the US.
Source: Bloomberg, data as of Sep 30, 2024.
For illustration purpose only.
*Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability of fitness for a particular purpose with respect to any of such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI's express written consent.
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US Market Indices
- Dow Jones Industrial Average NTR
- FTSE USA Index - Net Tax TR EUR
- MSCI* USA ESG Universal Sel Business Screen Net Return USD Index
- NASDAQ Composite Net Total Return
- S&P 500 Net Total Return Index
What are US Market Indices?
US market Indices are a financial indicator that measures the performance of the stock market in the United States. It represents the collective performance of a selected group of stocks listed on US exchanges.
Index performance
Source: MSCI & FTSE, data as of Sep 30, 2024.
Index performance base as 100. Past performance does not predict future returns. Investors cannot invest directly in an index. For illustration purpose only.
*Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability of fitness for a particular purpose with respect to any of such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI's express written consent.
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The Dow Jones Industrial Average is a price-weighted measure of 30 U.S. blue-chip companies. The index covers all industries except transportation and utilities.
Sector weightsSource: Bloomberg, data as of Sep 30, 2024.
For illustration purpose only.
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The FTSE USA Index is a market-capitalisation weighted index representing the performance of US large and mid cap stocks. The index is derived from the FTSE Global Equity Index Series (GEIS), which covers 98% of the world’s investable market capitalization.
Sector weightsSource: FTSE, data as of Sep 30, 2024.
For illustration purpose only.
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The MSCI* USA ESG Universal Select Business Screens Index is based on the MSCI USA Index, its parent index, and includes large and mid-cap securities of the U.S. equity markets. The index aims to represent the performance of a strategy that excludes companies that are associated with controversial weapons, nuclear weapons, oil sands or recreational cannabis; or derive revenues from conventional weapons, thermal coal, tobacco or civilian firearms; or are involved in very severe controversies pertaining to ESG issues; or have an MSCI ESG Rating of CCC.
Sector weightsSource: Bloomberg, data as of Sep 30, 2024.
For illustration purpose only.
*Neither MSCI nor any other party involved in or related to compiling, computing or creating the MSCI data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability of fitness for a particular purpose with respect to any of such data. Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages. No further distribution or dissemination of the MSCI data is permitted without MSCI's express written consent.
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The Nasdaq Composite Index measures all Nasdaq domestic and international based common type stocks listed on The Nasdaq Stock Market. To be eligible for inclusion in the Index, the security's U.S. listing must be exclusively on The Nasdaq Stock Market (unless the security was dually listed on another U.S. market prior to January 1, 2004 and has continuously maintained such listing). The security types eligible for the Index include common stocks, ordinary shares, ADRs, shares of beneficial interest or limited partnership interests and tracking stocks.
Sector weightsSource: Bloomberg, data as of Sep 30, 2024.
For illustration purpose only.
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The S&P 500 is widely regarded as the best single gauge of large-cap U.S. equities. The index includes 500 leading companies and covers approximately 80% of available market capitalization.
Sector weightsSource: Bloomberg, data as of Sep 30, 2024.
For illustration purpose only.
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Hong Kong Market Indices
- Hang Seng Index Net Total Return Index
The Hang Seng Index is the most widely quoted gauge of the Hong Kong stock market and includes the largest and most liquid 80 stocks listed on the Main Board of the Stock Exchange of Hong Kong.
Index performance
Source: Hang Seng Indexes, data as of Sep 30, 2024
Index performance base as 100. Past performance does not predict future returns. Investors cannot invest directly in an index. For illustration purpose only.
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Sector Weights
Source: Hang Seng Indexes, data as of Sep 30, 2024.
For illustration purpose only.
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Features and Investment Guideline of MPF Funds
As a smart MPF investor, it’s important for you to understand the features and investment regulations of MPF funds
5 Major Types of MPF Funds
- MPF Conservative Fund
- Guaranteed Fund
- Bond Fund
- Mixed Assets Fund
- Equity Fund
To protect scheme members’ interests, MPFA has put in place regulations and guidelines for trustees and investment managers to manage the assets of MPF schemes.
As of 30 September 2023, all constituent funds under Invesco MPF Strategic Scheme do not hold any AT 1 Bonds.
As you would appreciate, MPFA has not categorized AT1 bonds as impermissible investment based on the latest investment restrictions applicable to the Mandatory Provident Fund. As always, the investment teams overseeing the funds are monitoring the situation and are making decisions with the best interests of clients in mind. For MPF funds, investment teams would observe and ascertain all the investments are adhered to the investment objective of the respective constitution funds as well as the applicable investment restrictions as set out under Schedule 1 to MPF (General) Regulations and MPF Guidelines.
Under the current regime, MPF funds are subject to strict investment restrictions mandated by MPF legislation. These restrictions include prohibitions on investing in high-risk structured products and leveraging. Additionally, the total investment in securities and permissible investments issued by a single issuer cannot exceed 10% of the total assets of an MPF fund. These regulations aim to promote diversification and mitigate risk.
No, MPF investment, like any other investment, is not completely risk-free. The performance of MPF investments can be impacted during periods of market downturns. However, the MPF system has stringent investment regulations and restrictions in place to prevent excessive exposure to high-risk investments. These measures are aimed at safeguarding the MPF assets of scheme members over the long term.
ESG and Responsible Investing
ESG investing has become the mainstream investment strategy in recent years. We prepared a series of videos to introduce the philosophy and glossary of sustainable investing. For more information about ESG, please visit the dedicated page on ESG and Responsible Investing.
VIDEO Introduction to ESG: Environmental
In this video we examine eight key areas of environmental risks to investments.
VIDEO Introduction to ESG: Social
Social has traditionally been the least prominent element of ESG, but is now becoming a more important factor for companies and investors. It covers how organisations interact with stakeholders, clients, employees, suppliers, communities and society as a whole. In this video we examine the five key areas covered by Social.
VIDEO Introduction to ESG: Governance
Governance can be thought of as the bedrock of ESG, as a company’s commitment to Environmental and Social factors stem from its commitment to Governance. It’s how companies organize themselves and establish the responsibilities, rights and expectations of stakeholders, ensuring that these investor interests are met. In this video we examine the five key areas covered by Governance.
