Greece formally lost its developed market status on Wednesday, with Greek equities moving into the MSCI Emerging Markets Index instead.
The move came after MSCI, a leading provider of equity indexes, said in June that the Greek index failed to meet criteria regarding securities borrowing and lending facilities, short selling and transferability.
It prompted fears that such a downgrade might drive away investors, but many analysts argue that the outlook for Greek stocks is now in fact a lot rosier.
(Read more: Emerging Market Switch Could Boost Greek Stocks)
"For the index-aware Developed Market investors, Greece has certainly been off the radar; it's been a small part of a large universe. There will certainly be more attention on this market now as a bigger part of what is however a smaller universe," Matthew Beesley, head of global equities at Henderson Global Investors told CNBC.
"Furthermore, for Emerging Markets managers, given some of the budget-deficit induced macro problems across their universe, Greece at least presents a different set of challenges", he said.
With the move to emerging markets, more companies have gained access to the index. It will now comprise of ten stocks: Alpha Bank, Follie Follie, Hellenic Petroleum, Jumbo, National Bank of Greece (NBG), OPAP, OTE, Piraeus Bank,PPC & Titan Cement. The weighting of the index thus changed from 0.02 in the developed markets pool to 0.4 in the emerging market index.
This is the first time that the MSCI has downgraded a country from developed to emerging. In its annual market reclassification review, the MSCI checks criteria like economic development, size and liquidity, and market accessibility.
Greek stocks have been hit hard by the euro zone's debt crisis. The benchmark ASE lost fell 51.8 percent in 2011, and although it picked up in 2012, foreign investment inflows remained negative. In 2013 - with positive inflows - the ASE index is up 31.9 percent to date.