Let's say I own shares in the MSCI World ETF. Company X, where I am an employee, is currently not part of it. What happens when in ie a year Company X gets added to the ETF - Is my owning stock in it considered insider trading?
If so, would it mean I need to sell my existing share in this ETF or should no longer buy more of it?
Owning a stock is not trading a stock.
See https://en.wikipedia.org/wiki/Insider_trading.
If you are in a position of the company where you know (positive or negative) information about the company which would materially impact the stock price, you only commit insider trading when you use that knowledge before it becomes public knowledge.
Let's say I own shares in the MSCI World ETF. Company X, where I am an employee, is currently not part of it. What happens when in ie a year Company X gets added to the ETF - Is my owning stock in it considered insider trading?
The only way this would be insider trading is if you were providing non-publicly available information to the investment managers of the fund. For example if you had the numbers for the quarterly report a week before they were being released and you gave the numbers to MSCI.
The opposite is true. If you work for company X and the ETF/Mutual fund owned stock in your biggest competitor (Company Y) your boss wouldn't fire you for having a conflict of interest.
