1. What are the priorities for professional investors when assessing index-based strategies today? How do considerations—such as index methodology, expense ratios or performance—shape their decision-making?
Professional investors assessing index-based strategies today prioritize cost-efficiency, performance consistency and index quality. According to Cerulli Associates’ research,1 which explores how index-based strategies are reshaping U.S. wealth management, expense ratio and historical performance are the top factors influencing product selection, followed closely by the brand of the asset manager and index methodology. While index methodology investors increasingly recognize that indices are not interchangeable; the quality of index construction directly impacts tracking accuracy and portfolio outcomes.
As index-based strategies expand across asset classes, particularly in fixed income and direct indexing SMAs (separately managed accounts), professional investors are also engaging more deeply with index providers for thought leadership, customization and educational support. This shift reflects a broader trend toward predictable, low-cost exposures aligned with financial planning goals, rather than alpha generation alone.
2. What do investors and asset managers value most from an index provider—methodology, data, educational content or direct support—and how does S&P Dow Jones Indices (S&P DJI) approach this?
Investors and asset managers value index methodology and data quality most from index providers, but educational content and direct support are increasingly important differentiators. Cerulli Associates’ research shows that 82% of financial advisors rank quality of index design and methodology as a top-three factor when reviewing an index. This reflects a growing awareness that well-constructed indices are essential for consistency, transparency and cost-effectiveness.
While expense ratios and performance drive product-level decisions, deeper engagement with index providers—through thought leadership, educational resources and direct consultation—is becoming more common, especially among financial advisors building custom portfolios or using direct indexing.
3. How do the needs of different investors differ when engaging with index providers and how does S&P DJI adjust its approach to each group?
S&P DJI engages with a wide range of financial institutions and product providers to license our innovative indices and data to make them available to a variety of market participants and channels. We develop benchmarks to help investors and market participants measure performance and track trends. Our indices can be licensed and replicated to develop index-based investment strategies.
Firms and investors that implement index-based investment strategies have the opportunity to work closely with S&P DJI to customize indices or create white-label products. Many firms in wealth management develop model portfolios that use our indices as building blocks for portfolio construction. We have teams dedicated to specializing in index-based solutions and applications across specific channels like wealth, asset owner, retirement, insurance, exchanges and consultants (to name a few); these individuals work both with product providers and financial advisors to understand their needs and use cases, which results in a collaborative working relationship.
Index providers have become more than data vendors, having expanded to fulfill the role of strategic ally to financial advisors.
Delivering educational resources and market insights can enhance advisor engagement with their clients, offering differentiation in a competitive market.
4. Are there areas where S&P DJI is innovating or expanding its role through new data capabilities or initiatives, such as the ARC acquisition?
We just closed our acquisition of ARC Research, a dataset focused on private-client performance analytics. Being a returns-based index, we can pull anonymized account-level performance data and aggregate it by risk category.
We are also working on multi-asset indices for model portfolios using real-world holdings data—anonymized and aggregated—to provide greater clarity around allocation and performance standards for risk control portfolios.
We utilize unique datasets to deliver rules-based transparency for a comprehensive suite of environmental, social and governance (ESG) and sustainability indices across appropriate factors. These are especially prominent in Europe, due to Article 8/9 regulation and the broader push toward net-zero standards.
We have multi-asset solutions, such as options overlays that provide buffers or income, as well as retirement-date and relative-risk suites.
We continue to collaborate with a variety of data providers; this includes distinctive partnerships with firms that provide clarity to less transparent market segments, including private markets.
Indices are not designed in a vacuum. Asset managers, wealth managers and asset owners often come to us with specific objectives and we work together to design solutions that meet these needs. We have a dedicated team for research and index design, much of it done in collaboration with clients.
