Chief Executive Officer & Director, MORNINGSTAR INC
goRIA On-Location with Kunal Kapoor
Chuck’s recording LIVE at the Morningstar Investment Conference in Chicago. In this segment, Chuck catches up with Kunal Kapoor, CEO, Morningstar to discuss:
👉 Private markets are opaque… Morningstar can now help!
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About Kunal Kapoor
Kunal Kapoor, CEO of Morningstar, discussed the firm’s focus on artificial intelligence and the convergence of public and private markets in two recent appearances. In a June 2024 interview at the Morningstar Investment Conference, Kapoor said Morningstar is “remaking the way advisers access our data” through AI, adding that “we know the answers people are looking for when they come to us” and that AI makes it easier to provide them. He also described the firm’s work on “public private convergence,” which he said involves “rethinking how asset allocation is set up” and creating tools to help advisers build portfolios that include private investments. Speaking at the 2026 Morningstar Investment Conference, Kapoor argued that “the bar is rising” for human advisers, noting that “building portfolios is as complex and difficult as ever” despite strong markets. He stated that Morningstar’s capital market assumptions suggest future returns will slow, and that investors “are not going to earn 10, 12, 14% in the way that you perhaps have for the last few decades.” Kapoor also highlighted the growing role of private markets, pointing to the Morningstar PitchBook Unicorn 30 Index’s fivefold gain over the past decade, and cautioned that the higher fees of semi-liquid funds can erase their outperformance relative to liquid alternatives.
Transcript (26 segments)
✨ AI-enhanced transcript with speaker attribution
H
Host0:01
Okay, so we are back with our two days of live coverage at the Morningstar Conference in the Windy City, Chicago. And we're starting off day two with a bang. We have Kunal Kapoor, the CEO of Morningstar. Thanks for joining me.
K
Kunal Kapoor0:13
Great to be here, Chuck.
H
Host0:14
All right. I know you're real busy, so we appreciate you taking some time.
K
Kunal Kapoor0:17
Oh, no, it's fun.
H
Host0:18
But I was really eager to bring this to our audience. You did a great job up on stage. We're covering a lot of really important topics. Something that I talk a lot about on GOA also at my shop Sovereign, which is the idea that there's a convergence and a lot of concentration in market leadership. Do you feel that's driving the interest in private markets as a way of diversification?
K
Kunal Kapoor0:38
I certainly think it is a part of the discussion for sure. And I think what you're referring to is if you look at the Morningstar US Market Index, a few stocks are driving returns, and in particular you have one sector that's driving returns. What I will say is that rightly, it is leading to questions about how you diversify a portfolio. But private markets in and of themselves aren't 100% answer because if you look at our data within PitchBook, the returns in private markets have also been relatively concentrated, especially in private equity, where again, a handful of companies have delivered the returns. Now, what you can start to get though in private markets, and where I think diversification becomes interesting, is perhaps more non-correlated exposure when you're looking at asset classes like real estate. Those are harder to get access to in the public format. Obviously you have REITs, but direct ownership is a bit trickier in that sense. So what I'm trying to say is the answer is yes, but do the next level of diligence.
H
Host1:47
Without question. And that's perhaps a good segue to some really new exciting innovations you guys have come up with, including your indices for the semi-liquid markets.
K
Kunal Kapoor1:56
Yes. We'll be talking with Laura Lutton a little bit about that later today, and we had a chance to speak with Sanjay yesterday.
H
Host2:02
Good. But do you want to touch on that just a little bit on what's driving your move into that space?
K
Kunal Kapoor2:06
We go where investors are going. One of the challenges today is you wake up in the morning and you may ask yourself what did my indexes do yesterday? How did the market do? And you can fire up your computer and you can see what the Morningstar US Market Index did yesterday. But you can't quite tell if you own something in the private markets how to judge it.
H
Host2:26
That's right.
K
Kunal Kapoor2:27
And maybe that's okay. But over time, you do want some barometers. And importantly, you also want to be able to compare your private market investments to your public market investments. There's no such thing as a free lunch. It shouldn't be the case that just because something is private, it's better or worse than public. So we're working hard at things like indexes, fee comparisons that'll allow advisors to be able to not only evaluate private investments, but compare them more successfully to public investments as well.
H
Host3:01
Yeah, I think that's going to prove to be a very useful tool.
K
Kunal Kapoor3:04
I hope so.
H
Host3:04
And I know for myself as an adviser, this is sort of my side gig. I actually run a firm and run a book of business. And we are interested in also... So to the extent we can get leverage from an organization like Morningstar, I think that's super helpful.
K
Kunal Kapoor3:22
We're kind of in a seminal moment for that because you referenced the indexes. And in some of our indexes, you had a private company, a very large private company, SpaceX, going public for the first time. And it is actually quite interesting to understand how that migration happens. And these indexes are unique in the sense that they're the only ones where you see this migration of a company from private to public ownership and the company staying in the same index.
H
Host3:47
Yes.
K
Kunal Kapoor3:47
And so it's kind of cool from that perspective.
H
Host3:49
Yeah. Are you referring to the Unicorn Index?
K
Kunal Kapoor3:51
I'm referring not only to the Unicorn Index, which obviously has SpaceX, but also the Morningstar PitchBook 100 Public-Private Index.
H
Host4:01
Very good. All right. So, as we're coming up on time here, and I know you're getting pulled in various directions, what do you think is coming next for Morningstar? What could we expect perhaps next year or in the future?
K
Kunal Kapoor4:12
We're focused on two things right now: AI and helping advisers navigate public-private conversions. On the first, we're remaking the way advisers access our data and software. We know the answers people are looking for when they come to us; we're just going to give them to you. AI makes that a lot easier. And so we're rebuilding and rethinking how we do everything on that front. And then public-private convergence is really about helping build better portfolios and providing the right tools to do that. So, from rethinking how asset allocation is set up all the way to thinking about how you deliver a report to a client that feels seamless and doesn't feel like you're looking at two different worlds. That's really important.
H
Host4:52
That sounds good. Well, I think we're going to put a pin in it right there. Canal, thanks so much for joining me.
K
Kunal Kapoor4:55
All right. Thanks for having me.
H
Host4:57
This is just segment number one of day two. We have three more to go. I'll see you in another hour with some more content. Thanks for joining us and thanks again.
K
Kunal Kapoor5:06
Awesome. Thank you.