Morningstar Inc. announced Wednesday the launch of its Open Indexes Project, which will provide free access to more than 100 of the investment research firm's global equity indexes to asset owners, money managers, investment consultants and other financial firms.
The free access to the global equity indexes came from the realization that costs have been falling dramatically in the investing industry over the past three to five years; however, one cost that has not been coming down has been the cost of benchmarking data, said Joe Mansueto, Morningstar's founder, chairman and CEO, in a telephone interview.
“As we talked to asset managers, as they looked at their cost structure with a finer pencil and looking at bringing down their costs, benchmarking is one of their most significant data costs,” Mr. Mansueto said.
In creating the Open Indexes Project, Mr. Mansueto said the company was inspired in part by the software industry's embrace of open-source software.
“Let's take that same paradigm and apply that to the investment industry,” he said. “Free is a very powerful concept in any market, and we think that will go a long way toward adoption and help all market participants to lower costs.”
As part of the launch, Morningstar has created the Open Indexes Project Advisory Council that consists of 25 firms, including Ariel Investments, Dodge & Cox, Eaton Vance Management and Guggenheim InvestmentsDodge & Coxents, DoEaton VanceEaton Vance Management and Guggenheim Investments, among others.
The council is a “group of leading industry players to advise on the management of these open indexes,” Mr. Mansueto said, adding one role council members could have is to advise whether there are new indexes that should be made available.
Providing the global indexes at no charge, Mr. Mansueto said, is a shot at “changing the dynamic, changing the standard.”
Morningstar launched the Morningstar Indexes in 2002.