Does one of the index data providers already provide an appropriate index? If so, can I get it through my redistributor?
	Will one of the index data providers calculate a custom index to support my investment strategy? If so, will they make it available to me through my redistributor?
	Do I have, or can I get, the data to build the benchmark myself? If so, what construction methodology should I use? How will I verify the accuracy and integrity of my calculations?
	Are there any other options available to me?

Index data providers and redistributors are devoting tremendous resources to these issues:

	Virtually all of the major index providers are publishing new global index families, revising and/or extending existing index families and individual indices, and developing custom indices to meet individual client demands
	Redistributors are adding new index families and indices to their product offerings as driven by client demand	… in the News … IDFC Partners FTSE in Creation of New India Infrastructure Index Series MSCI Barra Launches Global Family of Islamic Indices Russell Launches Global Equity Indexes S&P Expands Global Thematic Index Series

Okay, I can get the data I need – what do I do with it?

Index specific data faces the same challenges as the broader category of reference data:

	How do I insure it is accurate? How do I enrich it if necessary?
	Where do I store it?
	How do I distribute it?
	Do I have (or can I put in place) license agreements that allow me to meet my business requirements?

There are almost as many approaches to answering these questions as there are asset management firms. Manual processes for gathering and entering index data coexist with automated feeds from vendors. Sometimes index data is imported directly into individual applications, and sometimes into a shared data store. Benchmarks are often calculated in a single application and shared as needed, while in other cases the same benchmark may be calculated multiple times.

Both index providers and redistributors recognize that data volume and consistency is a major challenge for their clients, but their ability to offer practical solutions is limited:

	An increased emphasis on data completeness and data quality is part of the marketing message of every service provider
	Although virtually all redistributors only deliver “official” index data, most of them take on a role of advocacy with the data providers, validating data and questioning perceived anomalies with individual index providers to ease the data cleansing challenge for their clients
	Redistributors are actively trying to ease the internal processing burden of asset management firms by offering common formatting and single sourcing for data from multiple index providers
	When permitted by the index provider, many redistributors are offering data and sometimes calculations that are not available directly from the index provider

This is a big problem – what can I do?

Index and benchmark data management is a critical challenge to asset management firms. Whether addressed within the context of reference data management or whether it is or becomes a project on its own, it is ultimately critical to the firm. The long term success of the firm is very often determined by the answer to the questions “are we ahead of or behind our benchmarks, and why?” Timely, accurate responses to these questions often make the difference between success and failure.

The challenges of identifying, obtaining and managing index data and constructing benchmarks is growing, and shows no signs of getting any easier. Manual and/or decentralized data management practices and processes are not providing the flexibility and responsiveness demanded by the investment professionals and client service teams at asset management firms.

At the Technology Council™ meetings in London on November 15 and New York on November 28, CutterResearch will present a detailed review of index data providers and member challenges and practices around maintaining and using indices and benchmarks.