MSCI World

The MSCI World is the global equity benchmark: it groups around 1,400 companies from 23 developed countries, weighted by market capitalisation. When someone says "indexing to the world", this is almost always what they mean.

What it contains (and in what proportion)

Cap-weighting concentrates the index where market value sits: around 70% in the United States, with the tech megacaps in the top spots, followed by Japan, the UK and continental Europe. The composition updates itself: growing companies weigh more, declining ones less — with no manager deciding anything.

What it does NOT contain

Two important absences its name does not suggest:

Emerging markets (China, India, Brazil…): to include them there is the MSCI ACWI (All Country World Index), which adds ~10% of emerging markets.

The World covers developed countries only; the ACWI adds emerging markets (~10% of the weight). Risk and historical behaviour are very similar; the choice is rarely decisive.

For the equity part, it is a perfectly reasonable base and most people's choice: maximum geographic and sector diversification in a single product. What is left out (emerging markets, small caps) can be added — or not — as a complement.

Its companies do, and the vehicle decides what happens: distributing classes pay them out (~1.5–2% yield) and accumulating ones reinvest them automatically.

What it contains (and in what proportion)

What it does NOT contain

How to invest in it

The usual criticism: concentration

Frequently asked questions