Morningstar has launched a new suite of equity indexes that goes beyond its traditional nine-square style box indexes that characterize fund holdings by market cap (large, mid and small) and investment styles (growth, value or a combination, called core).
The 12 new Morningstar Broad Style Indexes cover more segments of the equity market and will “facilitate better benchmarking of active strategies,” says Morningstar.
The indexes include large-cap, large-mid cap and mid-cap categories as well as an extended small-cap category that covers up to 99.5% of U.S. small-caps rather than the 97% included in Morningstar’s style box. Each of these four cap-weighted boxes are then assigned growth or value designations. There is no blend or core designation, as in Morningstar’s traditional equity indexes.