Company History
In the mid-1970s, while attending graduate school at the University of Chicago, Warren Schmalenberger, current President and CEO of asked himself why no index had ever been devised that would measure the overall value of the U.S. capital markets.
Equity indices—as exemplified by the well-known Dow Jones and Standard & Poor's indices—were immediately recognizable. Yet no one was tracking bonds or money market investments - much less the total value of U.S. capital markets.
As Mr. Schmalenberger considered this possibility, he became convinced that a capital markets index would have value not only among the professional investment community, but also among individual investors.
In the ensuing years, Mr. Schmalenberger gave additional thought to the idea, even as he was building a career in the financial-services industry. Several new indexes were developed and launched during this period, and creative variations such as exchange-traded funds (ETFs) and index mutual fund gained huge popularity among investors. However, a capital markets index was not among those developed.
In 1995, Mr. Schmalenberger founded in Houston. By that time, bond indexes were firmly established within the fixed-income markets, but there was still no index tracking liquidity, the total value of the U.S. capital markets or the asset allocation among equities, bonds and money market instruments.
He continued to believe that a capital markets index made sense—both intellectually and from a commercial standpoint. He also believed—and subsequent research would validate his conviction—that there would be strong market demand for a more-sophisticated measure of the performance of the entire capital market, an improved measure of risk-reward ratios, and better tools with which to make asset-allocation and investment decisions.
The process of building the Capital Markets Index, known as CPMKTS, thus was under way.
Read more about this topic: Capital Markets Index
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