The MSCI World: What Is Actually In It
September 13, 2026
5 min read
The MSCI World: What Is Actually In It
23 developed markets, a high US weight and three criticisms worth knowing — from a Swiss perspective.
The short version
- The MSCI World holds large and mid-cap companies from 23 developed markets, covering a very large share of their market capitalisation.
- Emerging markets are not included. No China, no India, no Brazil. The name misleads.
- The US weight sits at roughly 70%, and the ten largest positions together account for about a quarter of the index.
- For Swiss investors, fund domicile matters additionally, because the high US weight makes the withholding tax question particularly relevant.
01What the MSCI World represents
The index covers large and mid-sized listed companies from 23 developed markets, weighted by free-float market capitalisation: the larger a company and the more of its shares trade freely, the higher its weight.
The country list spans North America, Western Europe including Switzerland, Japan, Australia and several smaller markets. What is missing: all emerging markets, and the small companies that a small-cap variant would include.
Why "World" does not mean the world
The name describes developed markets, not the globe. Measured by population the index covers a small part of the world; measured by listed market capitalisation, a very large one. Both are true — only the first impression misleads.
Verified product facts
All of the following comes from the fund's key information document and prospectus, not from secondary sources: the fund tracks the MSCI World Index in its net return version, meaning after withholding taxes on dividends. It holds the securities physically and seeks to hold all index constituents in the same proportions. Income is not paid out but reinvested. Ongoing costs are 0.06% a year. The depositary is an Irish entity. The regulatory risk indicator is 4 out of 7.
02The three criticisms worth knowing
So that you read them here rather than elsewhere.
The US weight. It sits at roughly seventy percent. That is not a design flaw but the consequence of market-cap weighting: US companies are worth the most on public markets. It does mean the index's performance is closely tied to a single country.
Concentration at the top. The ten largest positions together make up about a quarter of the index. Over a thousand companies sounds like maximum diversification; in reality a handful of names drive a substantial share of the result. Diversification by count is not the same as diversification by risk.
The missing emerging markets. A significant part of the world economy is not represented. In mitigation: many of the included companies earn their revenue globally anyway. If you want emerging markets, take a broader index or a separate block — the trade-off is in MSCI World, FTSE All-World or ACWI.
03What differs for Swiss investors
German guides answer the MSCI World question differently from how it has to be answered for you. Three points they omit.
Fund domicile bites harder here. Because roughly seventy percent of the index is US equities, US withholding tax on dividends materially affects the outcome. An Irish-domiciled fund pays 15% instead of 30%. The effect sits in the order of 0.15% to 0.19% a year — more than many investors ever compare in fees.
Capital gains are tax-free. The appreciation of an MSCI World fund is not taxed as income for you. What is taxable is the portfolio value and the income — including in accumulating funds. Details in ETF Savings Plan Tax in Switzerland.
The franc is your reference currency. The index is denominated mostly in foreign currency. Over long periods hedging has not paid off for Swiss equity investors, because the costs consume the benefit.
04How to recognise a good MSCI World fund
The index is the same; the implementation is not. Four features decide.
Fund domicileIrish funds have an ISIN starting with IE
Replicationfull physical replication is the most transparent
Tracking differencemore informative than the TER alone
Fund sizevery small funds are closed more often
What we use
The arvy ETF Savings Plan covers the world equity market with two blocks: roughly 88% developed markets and roughly 12% emerging markets, both physically replicating and accumulating, 0.06% product costs together. On top comes the 0.39% management fee — 0.45% all-in in the Growth profile. Which funds those are is set out on The Building Blocks.
05Frequently asked questions
What is the MSCI World?
An equity index covering large and mid-sized companies from 23 developed markets, weighted by free-float market capitalisation. Emerging markets and small companies are not included.
How many companies does the MSCI World hold?
More than a thousand, with the exact number changing continuously as companies enter and leave. The authoritative figure is always the specific fund's factsheet with its reference date, not a number in an article.
Why is the US weight so high?
Because the index weights by market capitalisation and US companies are worth the most on public markets. That is not a flaw in the construction but its consequence. Reducing that concentration requires deliberately deviating from the index.
Does the MSCI World include Swiss shares?
Yes, Switzerland is one of the 23 developed markets. Its weight corresponds to the share of Swiss companies in developed-market capitalisation and is correspondingly small.
Is an MSCI World ETF suitable for Switzerland?
Yes, and for two reasons particularly: capital gains are tax-free for private investors, and with Irish fund domicile the US withholding tax on dividends is halved. Both are Swiss specifics that German guides do not cover.
Is an MSCI World ETF enough as an entire portfolio?
For many investors yes, provided the horizon is long enough and an emergency fund sits alongside. Anyone wanting emerging markets, small caps or a lower US weight adds deliberately — and then has to rebalance regularly.
Keep reading
Invest in the MSCI World, without small print
0.39% management plus 0.06% product costs, invested weekly, Irish fund domicile.
This article was written by Thierry Borgeat, co-founder of arvy, and reviewed by Patrick Rissi, CFA, and Florian Jauch, CFA.
Disclaimer: arvy AG is a manager of collective assets authorised by FINMA under Art. 24 CISA. This article is for information purposes only and constitutes neither investment advice nor tax or legal advice. All amounts are indicative and depend on canton, municipality and personal circumstances. Past performance is not a reliable indicator of future results.
