UPSTART MSCI Index Change

UPSTART is being dropped from the MSCI US Small Cap 1750 Index and added to the MSCI US Prime Market 750 index. The numbers 1750 and 750 of course refer to the numbers of companies in each index.

The classification criteria do not appear to reflect any direct analysis of the underlying business prospects, other than perhaps potential inferences from the factors below that are mentioned in the description of the selection methodologies.

Among the classification criteria are market capitalization of course, but also

  • the liquidity and trading characteristics

  • An analysis of the average size of portfolio holdings of a variety of large, mid cap, and small cap investment managers

My Upstart position was about 25% position before and is now about 22% after I added a tiny amount at around $255. My takeaway from the analysis by Bert Hochfeld at tickertarget.com is that the crash was not because of dismal business results but because many were expecting even more than was delivered and the current level is a buying opportunity.

BLancaster

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