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Vanguard Group's Arcane Move Sparks A Backlash From Investors
While MSCI is the foreign indexer elephant in the room, it appears to be the only one that still considers South Korea an emerging market. So when MSCI finally makes the change, people who care about Korea specifically will still wind up having to make adjustments. This is because Korea will be a smaller percentage of a developed market index than it currently is of the MSCI emerging market index.
In 2009, there was speculation that S. Korea would be reclassified by MSCI. Though Israel was, Korea wasn't. This Bloomberg article says the reasons had to do more with the stock market and currency there than the nation's economy. http://www.bloomberg.com/apps/news?pid=newsarchive&sid=azrZiPhvuzP4
Comments
ETFdb article on what is an emerging market country (IMF, Dow Jones, FTSE, MSCI):
http://etfdb.com/emerging-markets-etf-center/taiwan-south-korea-and-israel-developed-or-emerging-markets/
Dow Jones EM Total Stock Market Index (not the FTSE Vanguard is using, not the MSCI):
http://www.djindexes.com/mdsidx/downloads/fact_info/Dow_Jones_Emerging_Markets_Total_Stock_Market_Indexes_Fact_Sheet.pdf
In 2009, there was speculation that S. Korea would be reclassified by MSCI. Though Israel was, Korea wasn't. This Bloomberg article says the reasons had to do more with the stock market and currency there than the nation's economy.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=azrZiPhvuzP4