Name one good reason inclusion in the S&P 500 should not be strictly rule-based. I can't think of any.
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Harder to extract licensing fees from asset managers if it’s trivially replicable.
This is a good answer, but I think with the brand value of the S&P 500 they could extract sufficient fees while still being an open rules-based index at this point in their lifecycle.
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True - but you gotta pay more than you would think just to show clients your perf vs the index. I think a lot of smaller asset managers would pass if you could just say "here is the performance vs the 500 largest stocks wink wink".
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Prolly the most candid answer. SnP does have papers arguing fronting running etc which could have merit but its imbedded deep & havent seen many switches to more generic true Mcap indexes. Says alot about brand name and the marketing/research support you get licensing from them
End of conversation
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