FTSE may reclassify Asian markets

The index provider is consulting the market on how to treat China, Taiwan and South Korea.

Global index vendor FTSE has launched a consultation process with officials from institutional investors, fund management companies, stock markets and regulators to determine how to classify countries' economic status in indices, in a move that is likely to impact north Asian markets.

One driver behind the review is China's relatively new qualified foreign institutional investor scheme, which allows foreign portfolio money into the A-share market for the first time.

Paul Hoff, managing director at FTSE in Tokyo, says, China is rapidly moving to have foreign investors involved in its market. The capital flows can be tremendous. We estimate there is $200-300 billion invested in global emerging markets via institutional investors following...

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