MSCI: A Leading Global Benchmark Provider

MSCI: A Leading Global Benchmark Provider Morgan Stanley Capital International Inc. ("MSCI") is a leading provider of equity (international and US), fixed income and hedge fund indices. International Equity Indices MSCI provides global equity indices, which, over the last 30+ years, have become the most widely used international equity benchmarks by institutional investors. MSCI constructs global equity benchmark indices that contribute to the investment process by serving as relevant and accurate performance benchmarks and effective research tools, and as the basis for various investment vehicles. As such, the MSCI Equity Indices are designed to fulfill the investment needs of a wide variety of global institutional market participants. In constructing these indices, MSCI consistently applies its index construction and maintenance methodology across 23 developed and 27 emerging markets. This consistent approach makes it possible to aggregate individual country and industry indices to create meaningful composite, regional, sector and industry benchmarks. Close to 2,000 organizations worldwide currently use the MSCI international equity benchmarks. MSCI estimates that over USD 3 trillion are currently benchmarked to these indices on a worldwide basis. Products include Global, Regional and Country Equity Indices Sector, Industry Group and Industry Indices Value and Growth Indices Small Cap Equity Indices Hedged and GDP-weighted Indices Custom Equity Indices Real Time Equity Indices MSCI Equity Indices are available in local currency and USD, and with or without dividends reinvested. US Equity Indices In 2003, MSCI launched a new family of US Equity Indices to provide a much broader and deeper coverage of the US equity market. The new index series reflects the full breadth of investment opportunities within the US equity markets by capitalization size, value and growth investment styles and sector groups. By design, the MSCI US Equity Indices offer: More accurate representation of the US equity market and segments More frequent index reviews Robust value and growth style methodology Two dimensional, multi-factor Float weighted Transparent methodology More accurate representation of the investment process of size and style managers via unique buffer rules GICS?? Longest GICS sector history available in the market Lower index turnover via unique buffer rules Consistency with MSCI Global Equity Index Series Fixed Income Indices MSCI provides a wide range of fixed income indices for the investment community, including indices for Sovereign, Investment Grade and High Yield debt markets, as well as the Interest Rate Swaps market. The MSCI Fixed Income Indices are unique in their emphasis on trader quotes as the basis for security pricing, as well as on their use of an industry classification system based on the Global Industry Classification Standard (GICS ??). The GICS was developed by MSCI in conjunction with Standard & Poor's and is used by MSCI to classify securities in its equity indices. The use of GICS in the MSCI Fixed Income Indices facilitates analysis across asset classes. Hedge Fund Indices Hedge Fund Indices & Database Leveraging its unique understanding of the institutional asset management environment and its expertise in creating and managing global benchmarks, MSCI has developed a family of hedge fund indices based on a comprehensive classification system and a growing fund database. Hedge Invest Index Launched in 2003, the MSCI?Hedge Invest Index consists of a diverse sample of hedge funds that represent a broad range of hedge fund strategies and have weekly liquidity. The index may be licensed for the creation of index linked financial products. Global Industry Classification Standard In late 1999, MSCI, in collaboration with Standard & Poor's, introduced the Global Industry Classification Standard (GICS?. The GICS is designed to ease the investment research and management process for financial professionals worldwide by providing the most up to date and detailed security classification. The global investment community has overwhelmingly accepted the GICS as the new classification standard. GICS Direct GICS Direct is a joint product offering from MSCI and Standard and Poor's. It provides more than 26,000 company classifications (29,000 securities) worldwide in accordance with the GICS. Distribution MSCI delivers index and security level data through more than 60 vendors worldwide. In addition, MSCI distributes its data directly to clients in electronic and print products. Timeline: Major Developments 1969 - Developed Market Series (DM) 1987 - Emerging Market Series (EM) 1995 - All Country Series (DM + EM countries) 1997 - Value & Growth Indices 1998 - Small Cap Indices, Fixed Income Indices, Real Time Indices (Taiwan and Singapore) 1999 - Euro Equity Indices, Real Time Equity Indices (Euro, Pan-Euro, Europe, EMU and 15 European Countries) 2000 - Zhong Hua and Golden Dragon Equity Indices 2001 - All Country Sectors, Real Time Equity Indices (all DM regions, countries and sectors), GICS Direct 2002 - Real Time Equity Indices (all EM & AC regions, countries and sectors), Hedge Fund Indices & Database, Final Transition to Free Float Adjusted Market Capitalization for MSCI Equity Index Series 2003 - Hedge Invest Index, US Equity Indices, 10/40 Equity Indices