MSCI Launches Crowding Model Solution to Provide Institutional Investors With Daily Financial Traffic Data

Rhea-AI Summary

MSCI Inc. (NYSE: MSCI) has launched the MSCI Crowding Model, a new solution targeting institutional investors navigating crowded markets. This easy-to-use dashboard identifies crowded, neutral, or uncrowded scenarios across securities, factors, and hedge fund holdings. It addresses increasing market volatility and helps investors manage liquidity risks by assessing their exposure to crowdedness. The service is a response to rising demand for tailored investment analytics, allowing clients to make informed decisions based on dynamic metrics and proprietary data.

Positive

• Launch of the MSCI Crowding Model enhances product offerings for institutional investors.
• The solution helps identify crowded scenarios, potentially reducing portfolio risk.
• Responsive to market volatility, reflecting MSCI's commitment to innovation.

Negative

• None.

MSCI Inc. (NYSE: MSCI), a leading provider of critical decision support tools and services for the global investment community, today launched the MSCI Crowding Model solution to help institutional investors navigate crowded markets by providing high quality, timely information and data to inform their decision making in achieving their investment objectives.

The MSCI Crowding Model is built into an easy-to-use dashboard and helps identify crowded, neutral or uncrowded scenarios across individual securities, factors and hedge fund holdings. This enables investors to assess their own exposure to crowdedness and gain insight as to how the rest of the market is positioned.

The solution comes at a time where market sentiment can fluctuate wildly, possibly causing concentrations in investment managers’ holdings or trading styles. This can lead to higher volatility, diminishing returns, and potential liquidity and drawdown risks for investors. MSCI’s models are designed to enable investors to identify potential bubbles and assess:

• Security crowding: MSCI Security Crowding measures the degree to which a stock has been chased by investors.
• Factor crowding: The MSCI Factor Crowding Model allows investors to examine Factor Crowding over time using multiple dimensions that provide further insight into risk and return drivers.
• Hedge fund crowding: Measures hedge fund positioning and potential crowding around stocks, leveraging MSCI proprietary data sources providing transparency, global coverage and more frequent datasets

The launch of this service reflects the increasing demand for customized, targeted, and daily investment analytics. MSCI models infer the relative degree of crowdedness by examining a dynamic set of metrics incorporating holdings, pricing and return-based information that are sensitive to large amounts of capital following the same strategies.

“Expanding and evolving our analytical capabilities and offerings is a priority for MSCI as we continue our mission to be at the forefront of innovation. The launch of the Crowding Model solution is a testament to this as it aims to provide investors for the first time the opportunity to quickly assess crowding activity and risk,” said Jorge Mina, Head of Analytics at MSCI. “This solution underlines our systematic and process-oriented approach in providing information at the right time to help investors gain transparency and make better investment decisions. Our Crowding solutions serve as a navigator for an investment journey that provides quality data and information to enable investors to achieve their objectives.”

About MSCI Inc.

MSCI is a leading provider of critical decision support tools and services for the global investment community. With over 50 years of expertise in research, data, and technology, we power better investment decisions by enabling clients to understand and analyze key drivers of risk and return and confidently build more effective portfolios. We create industry-leading research-enhanced solutions that clients use to gain insight into and improve transparency across the investment process.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to future events or performance and involve risks that may cause actual results or performance differ materially and you should not place undue reliance on them. Risks that could affect results or performance are in MSCI’s Annual Report on Form 10-K for the most recent fiscal year ended on December 31 that is filed with the SEC. MSCI does not undertake to update any forward-looking statements. No information herein constitutes investment advice or should be relied on as such. MSCI grants no right or license to use its products or services without an appropriate license. MSCI MAKES NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE WITH RESPECT TO THE INFORMATION HEREIN AND DISCLAIMS ALL LIABILITY TO THE MAXIMUM EXTENT PERMITTED BY LAW.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210629005440/en/

FAQ

What is the MSCI Crowding Model?

The MSCI Crowding Model is a new solution designed to help institutional investors assess crowdedness in markets by identifying crowded, neutral, or uncrowded scenarios across securities and hedge fund holdings.

How does the MSCI Crowding Model benefit investors?

It provides timely data and insights to assess exposure to crowdedness and manage risks associated with market volatility, potentially leading to better investment decisions.

When was the MSCI Crowding Model launched?

The MSCI Crowding Model was launched on June 29, 2021.

What types of crowding does the MSCI Crowding Model measure?

It measures security crowding, factor crowding, and hedge fund crowding, providing insights into investor positioning and market trends.

What is MSCI's mission with the new model?

MSCI aims to provide investors with enhanced analytical capabilities and tools to navigate crowded markets and make informed investment decisions.