Since 1995, David Blitzer has been one of the most influential figures in stock markets around the world. He isn’t a household name, but as longtime chair of the index committee for S&P Global, Blitzer led the team that decides which companies go into the all-important S&P 500 index.
This index of the largest publicly traded American companies encompasses roughly 80% of the entire US stock market, and nearly $10 trillion—with a “T”—in assets is benchmarked or directly linked to it. Even as the rise of index funds and passive investing has cemented the S&P 500’s status as the premier benchmark of “the market” in portfolios and pension funds around the world, few people think very hard about how it is built, or the people who build it.
Blitzer retired last month after 24 years at the helm of S&P’s index committee, and his successor, Philip Murphy, inherited a system that’s a mix of art and science. The curation of the S&P 500 is guided by strict rules, but these are sometimes open to interpretation.