What's Happening?
Pitchbook and Morningstar have introduced a new index, the Morningstar PitchBook US Modern Market 100 Index, which combines public and private equity exposure. This index includes 90 of the largest US-listed companies and 10 significant late-stage venture-backed private companies, such as OpenAI, SpaceX, and Stripe. The initiative aims to provide a unified framework for benchmarking performance, offering a more accurate reflection of modern equity markets. According to Ron Bundy, president of Morningstar Indexes, the index empowers investors by providing a level playing field for evaluating both public and private investments.
Why It's Important?
The creation of this blended index is significant as it addresses the growing trend of private investments entering mainstream investor portfolios. By providing a benchmark that includes both public and private companies, the index offers investors a comprehensive tool to assess the performance of their investments. This development could influence investment strategies, encouraging more investors to consider private equity as part of their portfolios. It also highlights the evolving nature of equity markets, where traditional boundaries between public and private investments are becoming increasingly blurred.
