Open to the back pages of the "Money and Investing" section of the Wall Street Journal and you'll find a series of indexes, including those from the paper's parent company, Dow Jones. Then flip to fund listings provided by Lipper and you'll find a list of funds delineated by category: small-cap, large-cap, value, core, growth.

Don Phillips, the managing director of Chicago fund researcher and Lipper competitor, Morningstar, says the information contained on those pages is inadequate. Lipper's categorizations on one page don't correspond directly with the indexes on the other. And he thinks his firm has come up with a way to solve the problem.

Morningstar announced earlier this month that that it will offer a group of 16 new indexes by March or April of next year. It will include a broad-market index as well as large-, mid- and small-cap indexes. All will be available to fund companies who can license them at a fee to build new mutual funds, exchange-traded funds and other products.

Phillips said the move is partly intended to drive revenue through licensing agreements, but he said the new indexes are also "part of a bigger strategy" where the company has set out to create consistency in the way funds are evaluated.

The Nasdaq and Dow Jones indexes were never intended as portfolio-building tools, Phillips said.

"The problem hasn't been that people are buying bad funds," he said. "The problem is people are taking four or five good funds and assembling a bad portfolio. Three tech-heavy funds is not a diversified portfolio. How you think about stock funds, assembling your portfolio and tracking in the market, in practice, are quite divorced from each other."

The indexes, which are based on Morningstar's style box categorization scheme, examine those issues with more consistency, he said. The indexes will link with Morningstar's fund and stock categories, as well as portfolio building and market tracking tools, which Phillips says should help investors and professionals better understand where their funds are positioned in the market.

Morningstar's new indexes are also intended to engender a sense of uniformity among the firm's portfolio building services. Earlier this year, Morningstar expanded its business model to begin offering portfolios of mutual funds through its subsidiary, Morningstar Investment Services. The team that constructs fund portfolios for advisors will start using the new indexes to that end as soon as they are available, he said.

But Morningstar's plans for the new offerings come at a time when the business of creating indexes--and innovative uses for them--is far from stagnant. In fact, Dow Jones Indexes introduced in mid-December two new indexes, the Dow 5 and the Dow 10, both subsets of the Dow Jones Industrial Average. The Dow 10 will measure the 10 highest-yielding stocks of the DJIA, the company said, while the Dow 5 will track the lowest-priced stocks within the average. The company was expected to begin publishing watch lists for both indexes on Dec. 20.

The Dow index business presents a tantalizing model for firms seeking to boost their revenues. By some estimates, Dow Jones Indexes earned as much as $14 million last year from licensing its offerings. Phillips said his firm is expected to post earnings of about $90 million this year, compared to last year's $71 million.

The firm is already in talks with several companies who might license the indexes to create new products. Phillips would not say which ones. Fees for licensing Morningstar's new indexes have not yet been established, he said.

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