Two global giants in financial information and market data offerings have been known names for last 2 decades. This article discusses the services offered by Bloomberg and Morningstar, their commonalities, difference and scope of coverage.
Let’s begin with common offerings from Morningstar and Bloomberg:
- Both companies have similar client profiles for majority of customers - individual investors, financial advisors, researchers, traders and asset managers, and retirement plan providers and sponsors; although few exceptions may apply based on different services being offered.
- Both have significant market share in market data offering as a whole, though slight variations exists in terms of asset classes being covered (details below).
- Both have strong presence for news coverage
- Both offer clients with dedicated research tools and reports via multiple channels which includes online offerings through websites, emails, webinars, podcasts and digital reports, and offline offerings via print publications, conferences and scheduled events.
- Both are strong players offering software products that help clients take trading and investment decisions.
- Both offer dedicated symbol service using their own proprietary symbols – Bloomberg offers its symbols with a wide variety (BBGID, BB Ticker, etc.) allowing it to offer services like Open Symbology, while Morningstar does have its own symbols but no specific symbol mapping service.
- Both are providers of independent investment research – Morningstar remains an active player with explicit ratings and recommendations, Bloomberg research is offered via its reports
- Magazines: Earlier with “Bloomberg Markets”, and then with takeover of “Businessweek” magazine in 2011, Bloomberg complements its software offerings with print publications. Morningstar also offers similar publications both online and print media.
- Market Data services: The majority of Bloomberg’s business centers on data services, with its Terminal product accounting for majority of revenues. Morningstar too has a similar terminal product called QuoteSpeed.
- Financial News: Financial news makes an important ingredient for data services, and remains the most tracked item for any trading activities. Bloomberg news site gets more than 20 million visits per month. A free editorial edition of Bloomberg news is available through Bloomberg View, containing editorial and expert comments and opinions. Morningstar too has coverage of news at global level.
Key differences between services offered by Morningstar and Bloomberg:
- Morningstar is publicly listed on NASDAQ, while Bloomberg is a privately held company
Following services are offered by Morningstar, but not by Bloomberg:
- Morningstar offers rating services, primarily for stocks and mutual funds, through its well recognized nine-blocker display. Bloomberg does not have any explicit rating service, although it provides investment analysis reports and recommendations.
- Morningstar has its own investment consultancy and investment management service which had around USD 169 billion of assets under management as reported in September 2014. Bloomberg does not offer any such investment management service.
- Morningstar also has dedicated products and services exclusively for investment advisors like Morningstar Office and Morningstar Advisor Workstation. Though Bloomberg products may be used by advisory professionals, Bloomberg does not quote any products for them specifically.
Following services are offered by Bloomberg, but not by Morningstar: figures sourced from official Bloomberg site:
- Bloomberg Television: 340 million households benefit from 24 hour financial news coverage built upon the Bloomberg news network. Morningstar does not have any dedicated television service.
- Bloomberg Government (BGOV): Dedicated online offering which covers regulatory, political and legislative developments, aimed at professionals and organizations directly having dependencies, interactions and impact from government. With in-depth analysis, original content and reports for its clients, BGOV claims to track USD 5.2 trillion worth of US government contracts.
- Bloomberg Law (BNA): A subscription based services providing access to legal dockets, reports, filings and associated information, offers “coverage that spans the full range of legal practice areas, including tax & accounting, labor & employment, intellectual property, banking & securities, employee benefits, health care, privacy & data security, human resources, environment, and health & safety.”
- Bloomberg New Energy Finance (BNEF): Service which tracks more than 37,000 renewable energy projects, offering access to clean energy data details. Morningstar has coverage for this in its own capacity, through tracking of energy sector specific stocks and funds.
- Bloomberg Tradebook: Agency broker service that provides direct market access, analytical tools and trading algorithms, for buy-side and sell-side institutional clients, enabling them manage complex trading strategies for stocks, bonds futures, options and forex, in more than 100 global markets.
- Bloomberg Beta: Investment firm backed with USD 75 million funding from parent Bloomberg, this firm invests in budding entrepreneurial ventures at early stages.
- Bloomberg Open Symbology (BSYM): Symbol lookup and mapping service of different symbols (SEDOL, CUSIP, ISIN, Stock exchange ticker, etc.) at global level. Individual traders as well as large investment firms having a need to consolidate data sourced from multiple sources with different symbols use this service. For e.g. a mutual fund company may take 2 different data feeds – one from Bloomberg containing Bloomberg symbol and other from Stock exchange containing local ticker. Symbology service enables cross referencing to validate data across two sources with different tickers.
The Bottom Line
Both Bloomberg and Morningstar are leaders in market data, news, analytics and software products catering to financial market needs. With few variations, both compete head to head in the market space. Depending upon the fit to individual or organization needs, required service from either of the these (or other vendors) can be selected.