Powered by MOMENTUM MEDIA

Morningstar to provide open access to indexes

By Killian Plastow
 — 1 minute read

Research house Morningstar will provide asset managers and other financial services providers with free access to over 100 global equity indexes for use in benchmarking as part of its new Open Indexes Project.

The company said it was launching the project “in response to the escalating cost of market-cap-weighted equity indexes” in a bid to lower industry costs and provide better outcomes to investors.

“Fund investors today are paying substantially lower fees than when we opened our doors more than 30 years ago,” said Morningstar chair and chief executive Joe Mansueto.

Advertisement
Advertisement

“One industry cost that’s moving in the opposite direction is the fee charged for indexes used to measure and compare relative investment performance.”

Despite benchmarking being an “extremely important” process, Mr Mansueto said there were “only a handful of index providers”, and these providers were using their power to dramatically increase fees.

“Benchmarks are meant to explicitly represent the performance of the underlying markets,” he said.

“As such, we believe market-cap-weighted equity indexes are virtually interchangeable and should be priced accordingly, but they’re not. That’s why we’re embarking on this project.”

Read more:

Don’t neglect tech start-ups: Right Click Capital

Bennelong to open UK fund manager

ETF industry needs to innovate distribution: EY

Impact investing industry set to grow

ANZ planning to sell Australian wealth business

 

 

Stimulate new ideas. Stimulate new thinking. Top up your CPD and hear from industry experts with InvestorDaily’s Knowledge Centre. Keep up to date with the latest trends and reforms, all while adding to your CPD. Explore the knowledge centre Knowledge Centre now. 

Morningstar to provide open access to indexes
investordaily image
ID logo

 

related articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.