Israeli capital market players to await bonanza?
Israeli capital market players are looking to February with bated breath, in hopes that the results of a survey of global investors will lead to Israeli stocks being added to a key regional index benchmark, a move that could add at least USD 1 billion in investments into Israeli equities, according to some estimates.
MSCI Inc., a US financial firm that is a global provider of equity, fixed income and equity indexes for investors to track with the funds they manage, said in December it has started a poll among international investors to see how they perceive their investment opportunity in Israel:
The question: Do they still see Israel as part of a Middle East investment opportunity or should the nation be reclassified, in terms of its index, elsewhere – for example in Europe, or Asia?
Investors have until the end of the month to provide their survey feedback, and the results of the consultation will be published on or before February 28.
If the reclassification is approved, and Israel is added to the MSCI Europe Index, as hoped, the implications for the Israeli capital market would be “hugely significant,” said an analyst at an investment bank.
“Being added to the MSCI Europe index would be an important acknowledgement to the maturity of the Israeli capital market, and will have an important role in opening the currently concentrated financial system. The biggest international VC and PE funds have already significant presence in Israel, and I don’t see any reason why traded funds based on MSCI indexes and other similar funds cannot take a part in the local capital market as well,” said Dr. Shachar Hadar, partner in Meitar’s Corporate and Securities Group.
Fellow partner, Yoav Nahir added: “I think any investor and fund manager who have investment experience in Israel, can state that the financial eco-system, including the regulatory and legal environments, in Israel meets the same standards as other European financial systems, and I hope this will be reflected in their votes.”
