What Is The Morgan Stanley Capital International All Country World Index Ex-U.S. (MSCI ACWI Ex-U.S.)?

The Morgan Stanley Capital International All Country World Index Ex-U.S. (MSCI ACWI Ex-U.S.) is a market-capitalization-weighted index maintained by Morgan Stanley Capital International (MSCI). It is designed to provide a broad measure of stock performance throughout the world, with the exception of U.S.-based companies. The MSCI ACWI Ex-U.S. includes both developed and emerging markets.

Key Takeaways

  • The MSCI ACWI Ex-U.S. is a stock market index comprising of non-U.S. stocks from 23 developed markets and 26 emerging markets.
  • The Index is made up of 2,412 constituents, which is 85% of the global equity market aside from the U.S.
  • Sectors covered in the index include health care, industry, finance, consumer staples, and information technology.
  • The index is calculated with a methodology that focuses on liquidity, investability, and replicability.
  • The MSCI ACWI Ex-U.S. is one of 222,000 indexes provided by the MSCI.

Understanding The Morgan Stanley Capital International All Country World Index Ex-U.S. (MSCI ACWI Ex-U.S.)

For investors who benchmark their U.S. and international stocks separately, this index provides a way to monitor international exposure apart from U.S. investments. On Dec. 31, 2019, the MSCI ACWI Ex-U.S. held mid and large-cap holdings across 22 countries classified as developed markets out of 23 and 26 classified as emerging markets.

The top 10 holdings of the MSCI ACWI Ex-U.S. as of Dec. 31, 2019, were as follows:

  • Alibaba Group Holdings
  • Nestle
  • Tencent Holdings
  • Taiwan Semiconductor
  • Samsung Electronics Co.
  • Roche Holdings
  • Novartis
  • Toyota Motor Corp.
  • HSBC Holdings
  • SAP

These holdings span the following nations with country weights of Japan (16.14%), United Kingdom (10.84%), China (9.44%), France (7.51%), Canada (6.67%), and Other (49.40%).

Some of the sector weights of the index include Financials (21.43%), Industrials (11.94%), Consumer Discretionary (11.79%), Consumer Staples (9.43%), Information Technology (9.39%), Health Care (8.86%), and Materials (7.39%).

Methodology for Calculating The Morgan Stanley Capital International All Country World Index Ex-U.S. (MSCI ACWI Ex-U.S.)

The MSCI ACWI Ex-U.S. Index calculation is determined on the MSCI Global Investable Market Indexes (GIMI) methodology. This approach to index construction allows for global views and regional comparisons across all market capitalization size, sector, and style segments and combinations. The methodology focuses on index liquidity, investability, and replicability. Portfolio managers review the index quarterly—in February, May, August, and November. The aim of each review is to reflect changes in the covered equity markets. Managers re-balance the index during the May and November reviews and re-calculate the large and mid-capitalization cutoff points.

The MSCI ACWI Ex-U.S. Index should not be confused with MSCI, the independent provider of institutional investor insights and tools. Existing outside of any existing financial institution, MSCI consists of 222,000+ equity indexes that are calculated daily. Notably, 12.3 trillion in equity assets are benchmarked to MSCI indexes worldwide, while 99 of the top 100 global investment managers are clients of MSCI. MSCI’s leading equity indexes include the following: 

  • MSCI ACWI
  • MSCI USA
  • MSCI World
  • MSCI EAFE
  • MSCI Emerging Markets
  • MSCI Europe