In
investing
Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort.
In finance, the purpose of investing i ...
, a developed market is a country that is most developed in terms of its economy and capital markets. The country must be high income, but this also includes openness to foreign ownership, ease of capital movement, and efficiency of market institutions. This term is contrasted with
developing market (
emerging markets
An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or wer ...
and
frontier markets are types of developing markets).
FTSE Group list
FTSE Group
FTSE International Limited trading as FTSE Russell ( "Footsie") is a British provider of stock market indices and associated data services, wholly owned by the London Stock Exchange (LSE) and operating from premises in Canary Wharf. It operate ...
, a provider of economic and financial data, assigns the market status of countries as Developed, Advanced Emerging, Secondary Emerging or Frontier on the basis of their economic size, wealth, quality of markets, depth of markets, breadth of markets.
From 26 September 2019, FTSE Group classifies 26 countries as developed markets:
FTSE criteria
Developed countries all have met criteria under the following categories:
# They are high income economies (as measured by the World Bank GNI per capita Rating, Market and Regulatory Environment)
## Formal stock market regulatory authorities actively monitor market (e.g., SEC, FSA, SFC)
## Fair and non-prejudicial treatment of minority shareholders
## Non or selective incidence of foreign ownership restrictions
## No objections or significant restrictions or penalties applied on the repatriation of capital
## Free and well-developed equity market
## Free and well-developed foreign exchange market
## Non or simple registration process for foreign investors
# Custody and Settlement
## Settlement – Rare incidence of failed trades
## Custody-Sufficient competition to ensure high quality custodian services
## Clearing & settlement – T +3 or shorter, T+7 or shorter for Frontier
## Stock Lending is permitted
## Settlement – Free delivery available
## Custody – Omnibus account facilities available to international investors
# Dealing Landscape
## Brokerage – Sufficient competition to ensure high quality broker services
## Liquidity – Sufficient broad market liquidity to support sizeable global investment
## Transaction costs – implicit and explicit costs to be reasonable and competitive
## Short sales permitted
## Off-exchange transactions permitted
## Efficient trading mechanism
## Transparency –
market depth
In finance, market depth is a real-time list displaying the quantity to be sold versus unit price. The list is organized by price level and is reflective of real-time market activity. Mathematically, it is the size of an order needed to move the ...
information / visibility and timely trade reporting process
# Derivatives
## Developed derivatives markets
# Size of Market
## Market Capitalisation
## Total Number of Listed Companies (as of 31 December 2008)
MSCI list
As of June 2019,
MSCI
MSCI Inc. is an American finance company headquartered in New York City. MSCI is a global provider of equity, fixed income, real estate indexes, multi-asset portfolio analysis tools, ESG and climate products. It operates the MSCI World, MSCI ...
classified the following 25 countries as developed markets:
According to ''MSCI Global investable Market Indexes Methodology – November 2019'',
Cyprus
Cyprus ; tr, Kıbrıs (), officially the Republic of Cyprus,, , lit: Republic of Cyprus is an island country located south of the Anatolian Peninsula in the eastern Mediterranean Sea. Its continental position is disputed; while it is ...
and
Luxembourg
Luxembourg ( ; lb, Lëtzebuerg ; french: link=no, Luxembourg; german: link=no, Luxemburg), officially the Grand Duchy of Luxembourg, ; french: link=no, Grand-Duché de Luxembourg ; german: link=no, Großherzogtum Luxemburg is a small lan ...
"are part of the developed market universe", but "given their modest size, these markets are not included in the
MSCI World index".
S&P list
As of 24 June 2019,
Standard and Poor's classifies the following 25 countries as developed markets:
STOXX list
As of 23 September 2019,
STOXX
STOXX Ltd. is a Swiss globally integrated Index (economics), index provider, covering the world markets across all asset classes – developing, maintaining, distributing and marketing a comprehensive global family of strictly rules-based and tra ...
classifies the following 25 countries as developed markets:
Table
See also
*
Developed country
A developed country (or industrialized country, high-income country, more economically developed country (MEDC), advanced country) is a sovereign state that has a high quality of life, developed economy and advanced technological infrastruct ...
*
Emerging market
*
First World
The concept of First World originated during the Cold War and comprised countries that were under the influence of the United States and the rest of NATO and opposed the Soviet Union and/or communism during the Cold War. Since the collapse of ...
*
Frontier markets
*
Global North and Global South
References
{{Reflist
Economic country classifications
International development
Investment