A newer addition to the portfolio is S&P Global. The company, which became part of the fund late last year, is part of a ratings duopoly with Moody’s that accounts for most of the ratings market. Because time-constrained issuers typically meet with no more than a couple of ratings agencies, S&P is in an excellent position to remain a credit ratings leader.
S&P is also well-positioned to grow its other businesses, including a business unit that creates and markets indices that are used for a growing roster of investment products. As the largest index business in the world, it has nearly $14 trillion of assets tied to its benchmark indices. Another business segment, S&P Global Market Intelligence (Capital IQ), is a provider of financial research, and its mission is to capture an entire generation of financial professionals the way Bloomberg did in the 1980s. “Two-thirds of financial professionals are millennials,” says Milligan. “They like Capital IQ’s potential to create more intuitive natural-language search capabilities, following S&P Global’s acquisition of Kensho Technologies.”
Although Milligan doesn’t like to make economic calls, he is keeping a close eye on trade talks and believes they are likely to be a driver in stock market returns going forward. “I’ve noticed a bit more uncertainty from management on corporate conference calls over the last year or so because of concerns about trade,” he says. “A lot will depend on where things go on that front.”