Scientific Beta

In September 2014, ERI Scientific Beta announced that it had placed Greece and South Korea on a watch list for potential reclassification from the Developed to Emerging Markets category. In accordance with ERI Scientific Beta Universe Construction Rules, and following a review by the ERI Scientific Beta Country Committee, the decision has been made to reclassify these two countries. 

In September 2014, ERI Scientific Beta announced that it had placed Greece and South Korea on a watch list for potential reclassification from the Developed to Emerging Markets category.

In accordance with ERI Scientific Beta Universe Construction Rules, and following a review by the ERI Scientific Beta Country Committee, the decision has been made to reclassify Greece and South Korea from Developed Markets to Emerging Markets. This decision is coherent with the changes in the country classification rules implemented on 23 September, 2014.

• Greece
  
  The reclassification of Greece has been confirmed by the ERI Scientific Beta Country Committee for the following reasons: Greece was added to the Scientific Beta watch list due to the reduction in its market size and liquidity criteria. Its aggregated domestic total market capitalisation still lies below the minimum threshold of USD 60 billion and Greece fails to qualify on several market accessibility criteria (notably stock borrowing and short selling).
  
  
• South Korea
  
  The reclassification of South Korea has been confirmed by the ERI Scientific Beta Country Committee for the following reasons: The South Korean equity market continues to meet most of the Developed Market criteria but lacks meaningful improvements with respect to the convertibility of its currency. This has led Scientific Beta to opt for the reclassification of South Korea from Developed Markets to Emerging Markets.

The reclassification of Greece and South Korea will coincide with the June 2015 quarterly index review.

In accordance with our correction policy for track records, this will be applied going forward only, and will therefore not affect track records established before 22 June, 2015.

In order to ensure the smooth transition to the revised ERI Scientific Beta stocks universe, an indicative list of added/deleted constituents will be made available to our clients in May 2015.