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Anonymous

30 May 2020

Why does MSCI discontinuation affect SGX stock price so much?

SGX prices has drop about 11% after they announce to discontinue most MSCI equity index futures and options contract next year why is this so?

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    Discussion (1)

    What are your thoughts?

    My view:

    SGX gets revenue from market activities and volume. Without the futures and options contract, the activity and volume on SGX will reduce. Hence the revenue is lesser.

    With lesser revenue, the profits will probably decline as well. Potentially could impact the dividend.

    Perhaps that’s why the market sentiment is not very positive on the news.

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