A peer-analysis piece examining Anthropic against comparable companies across several dimensions relevant to institutional and advisor audiences tracking the AI sector.
A Multi-Dimensional Peer Analysis of Anthropic
Kenney, writing as a Partner at NEPC, examines the rise of hospitals and health systems investing directly in healthcare companies or through healthcare-focused private equity funds as a way to drive clinical innovation and financial returns. Drawing on an NEPC survey of 21 healthcare providers, he reports that 71% were either already making strategic investments or considering them, though most held five or fewer at the time — and that the trend was concentrated among larger organizations, with the majority of respondents holding over $1 billion in operating assets. He walks through the key decisions providers face: whether to invest directly or through funds (nearly half do both, though most found evaluating direct deals far more daunting than fund investments), whether to pursue a broad or targeted sector approach, how to measure clinical and financial success given the longer timelines involved, and how to coordinate between treasury/finance and innovation teams, which he found was often a weak link. Kenney concludes that despite being an early-stage trend, strategic investing is likely to become as routine for well-resourced health systems as alternatives or liability-driven investing have become, provided organizations approach it with patience and sound governance.
Becker's Healthcare: Will strategic investments in healthcare be a short-lived trend or the new normal?
Kenney examines how private companies now stay private longer, prompting managers to court retail investors as an untapped source of capital. He explains that private markets lack the disclosure and real-time pricing public markets have, leaving investors reliant on GP-reported valuations that lag behind current conditions. Only a few hundred of roughly 300,000 private companies trade with enough secondary volume for reliable pricing. He notes that the most liquid private-market segment is even more concentrated than the S&P 500, both in its largest holdings and its heavy tilt toward technology, with SpaceX's IPO reinforcing that skew. Kenney concludes that better data, secondary pricing, and index construction are gradually closing the gap between private and public markets, giving investors more confidence as access to this space widens.
Building Bridges: Understanding & Navigating the Structural Divide Between Private & Public Markets
Data, Custom Indexing Reshape Public Equity Portfolios
Kenney lays out practical guidance for family offices building a direct-investment program, building on the mixed performance findings from his earlier piece. He frames several key strategic choices: pairing direct deals with GP-led fund investments rather than treating them as either/or, weighing active board-level involvement against more passive participation, and favoring buyout-style deals over venture capital, where information asymmetries and high failure rates make direct investing especially hard. He also addresses co-investing versus solo deals, sector-focused versus generalist approaches, whether to build capabilities in-house or lean on outside experts, and the tradeoffs of investing alongside partners. He closes with three core recommendations: rigorous due diligence focused on the family office's real competitive edge rather than just fee savings, strong governance around capital-deployment decisions and follow-on financing rounds, and self-awareness about organizational blind spots so investment size and complexity stay within the office's actual capabilities.
Direct Investing: Tips for Setting A Program Up for Success
Kenney examines the limited data available on the performance of direct private investments and finds the results mixed at best for family offices. While direct investing appeals to wealthy individuals because it avoids the management and performance fees charged by private equity funds, he notes there's little proof it beats fund benchmarks — individual investors struggle to match the experience, networks, and deal access of professional PE firms. Drawing on a 2014 academic study of seven large institutional investors (average AUM of $94 billion, 390 transactions from 1991–2011), he reports that co-investments tended to underperform the funds they rode alongside — largely due to adverse deal selection in hot markets — while solo direct deals outperformed funds overall, though both approaches lost ground over time. The piece concludes that proximity and hands-on involvement improved outcomes, and that direct investing is toughest to pull off in areas like venture capital, where general partners hold a strong information edge.
Direct Investment: What Do The Numbers Say?
A WealthManagement.com piece breaking down direct investment approaches for institutional and high-net-worth audiences, continuing the direct-investing themes NEPC published across a multi-part series Kenney contributed to.
An NEPC insights piece on direct investment strategies for institutional portfolios, part of a broader series exploring direct investing approaches published c. 2019–2021.
Prompted by a broad tech-driven sell-off that hit companies across multiple GICS sectors, Kenney argues that standard sector classification badly understates how much of the S&P 500 is actually exposed to technology. While the Information Technology sector officially accounted for 27.6% of the index at the time, he shows that a more accurate figure, capturing technology exposure embedded across other sectors, is 42%. He explains that GICS falls short because it assigns companies to a single sector based on their primary business (missing secondary tech-driven revenue, as with Amazon's cloud business), applies a one-size-fits-all sector structure that can't isolate cross-sector themes, and updates its category definitions too slowly to reflect real shifts in how companies operate, such as the 2018 creation of the Communication Services sector. Using Syntax's Affinity data, which tags companies by underlying product line rather than primary business, Kenney recalculates the index's true technology exposure and breaks down its composition across software, hardware, fintech, and infrastructure businesses spanning six different GICS sectors. He also shows that this more accurate tech exposure has climbed above levels last seen during the 2000 tech bubble, accelerating through the pandemic, and argues that even without predicting what comes next, quantifying true thematic exposure is an essential first step for investors managing concentration risk.
Do You Know What You Own? How Much Technology is Really in the S&P 500?
This piece explores how direct indexing is emerging as a complement to, rather than a replacement for, ETFs in advisor portfolios. Kenney, quoted throughout as SVP of Client Solutions at Syntax Data, argues that while ETFs remain valuable for their simplicity, liquidity, and cost efficiency, they can't yet match the customization, precision, and tax optimization that direct indexing offers. He points to inconsistencies among cybersecurity-themed ETFs as an example of how different providers can implement the same investment theme in very different ways, whereas a direct index lets an advisor define exactly what characteristics they want, removing ambiguity about what's actually being held. The article also cites SSGA's Allison Bonds Mazza, who notes that direct indexing has become more accessible thanks to technological advances that reduce its historical cost and complexity. Kenney illustrates a practical 'core-satellite' use case: a family with significant real estate exposure using a broad Russell 3000 ETF as a core holding while adding a direct index built around non-residential REITs to avoid doubling up on housing risk. He concludes that the choice isn't ETFs versus direct indexing, but rather how advisors blend the two to fit each client's needs, with ETFs serving as the portfolio's foundation and direct indexing layered on top for personalization.
ETFs Vs. Direct Indexing: How Advisors Are Building The Next Generation Of Portfolios
ETFs vs Direct Indexing: How Advisors Are Building the Next Generation of Portfolios
How Useful Is AI in Institutional Investing Right Now?
Kenney reflects on the evolving role of the financial advisor, considering how client relationships, technology, and portfolio construction have shifted the profession's day-to-day responsibilities and its future direction.
In Recognition of Financial Advisors – What They Do and Where They Are Going
Investors Know They Own Too Much Tech. This Analysis Shows That It’s Worse Than They Think.
Is Your Portfolio Leaning Too Hard On A Few Stocks?
Kenney uses Syntax's proprietary classification framework to show that standard geographic benchmarks carry more hidden sector concentration than conventional classification systems reveal. Looking at the S&P 1500, MSCI EAFE, and MSCI Emerging Markets indices, he finds true technology exposure runs well above reported GICS figures, with the S&P 1500's tech weight reaching 40% and MSCI EM's reaching 34% once software- and hardware-driven product lines are captured across sector lines. He also highlights that MSCI EAFE and MSCI EM carry roughly twice the Financials exposure of the U.S. market, with MSCI EM particularly concentrated in banking, and that all three indices carry meaningful exposure to Industrials and commodity-linked businesses, with MSCI EM showing the strongest tilt toward metals and chemicals. On single-stock risk, he notes that the S&P 1500 and MSCI EM both have notable top-10 concentration, driven largely by mega-cap tech names like Apple, Microsoft, and Taiwan Semiconductor, while MSCI EAFE is comparatively diversified. Kenney concludes that investors relying on geographic diversification alone may be underestimating the sector and single-stock risks embedded in their portfolios, and argues that more granular classification data can better inform asset allocation and manager selection.
Know What You Own: Underlying Concentration Risks Embedded in Domestic, International, and Emerging Markets Equity Indices
Kenney challenges the assumption that benchmark selection is a neutral, default decision, opening with an example showing that 'sector-neutral' is defined relative to a benchmark like the S&P 500, not by literal equal weighting. He shows how benchmarks quietly evolve over time, noting that the Bloomberg U.S. Aggregate Bond Index's duration has swung meaningfully over the past 20 years and that its Treasury weighting has nearly doubled as government debt issuance has grown, both of which reshape the risk embedded in the index. He also explores how benchmarks like the S&P 500 shape investor psychology, contrasting the disillusionment of the 2000s' flat decade with the FOMO-driven passive investing boom that followed the 2010s recovery. Citing the CFA Institute's SAMURAI framework, Kenney outlines seven criteria a benchmark should meet, including being specified in advance, appropriate to the manager's style, and genuinely investable, and distinguishes this from a simple return objective, which fails several of those tests despite feeling benchmark-like. He concludes that benchmarks can obscure structural risks, from tech concentration in the S&P 500 to rising Treasury dominance in the Aggregate Bond Index, and urges investors to select them deliberately rather than by default.
Benchmarks Must Be Chosen Carefully To Avoid Structural Risks
Re-Evaluating The Status Quo: Benchmarks
Kenney responds to a Wall Street Journal piece by Jason Zweig, which found that the S&P 500 Equal Weight Index's long-term outperformance over its cap-weighted counterpart largely evaporates once real-world trading costs are factored in, citing the Invesco RSP ETF's underperformance versus its own paper index. Kenney argues direct indexing offers a structural fix to that problem. He points out that separately-managed direct portfolios typically cost roughly half the expense ratio of a fund like RSP, and outlines three ways direct indexing can cut the turnover-driven friction Zweig highlighted: using buffer-based rebalancing instead of rigid quarterly schedules, holding a smaller representative set of securities rather than all 500 names, and trading opportunistically instead of on a fixed calendar. He also highlights tax-loss harvesting as a key advantage unavailable to pooled ETF investors, since direct-indexing investors hold individual tax lots that can be harvested for losses even when the overall index is up, citing academic estimates of 30 to 65 basis points in resulting 'tax alpha.' Kenney concludes that direct indexing lets advisors capture the theoretical benefits of strategies like equal-weighting while sidestepping the cost drag that limits pooled fund vehicles.
Reducing Friction and Improving Performance Through Direct Indexing
Rush University Medical Center and NEPC Use PFaroe
A quarterly performance review of the Syntax Stratified LargeCap Index, covering sector positioning and results relative to conventional cap-weighted benchmarks over the first quarter of 2025.
Syntax Advisors Hires Paul R. Kenney, Jr. as Managing Director
An overview of the Syntax Direct platform, describing how it lets advisors build and manage customized, tax-aware direct indexing portfolios for clients at scale.
Syntax Direct: A Direct-to-Index Solution Platform
A case study walking through the construction of a defensive equity index on the Syntax Direct platform, illustrating how direct indexing can be used to manage downside risk within a broader portfolio.
Syntax Direct Case Study: Creating a Defensive Equity Index to Balance Portfolio Risk
The prior year's quarterly review of the Syntax Stratified LargeCap Index, tracking how its diversified sector-weighting methodology performed through the first quarter of 2024.
Syntax Stratified LargeCap Q1 2024 Review
An introduction to the Syntax US Medical Innovations Index, built to capture companies driving advances in medical technology, diagnostics, and treatment innovation.
A Kiplinger column arguing that technology has lowered the operational barriers to direct indexing, making the case for advisers to adopt it more broadly for their clients.
Tech Has Simplified Direct Indexing, and That's Not the Only Reason Financial Advisers Should Make the Leap
Kenney, SVP of Client Solutions at Syntax Data, makes the case that investment managers should reclaim ownership of their narrative rather than letting third-party evaluators like Morningstar flatten their strategies into ratings and style boxes. Opening with examples from Morgan Housel's Same as Ever on how compelling storytelling — not just novel ideas — drives influence, he argues managers can use data science and alternative data to tell a richer, more accurate story about their portfolios. He shows how structured, sentence-like tagging of company activities and resources can reveal a company's true business model (e.g., recasting Lyft as a software firm serving transportation rather than an industrial company), and uses Snap-On as an example of how single-product perception often hides a far more diversified revenue base. He also demonstrates how drilling into subsector-level detail — illustrated through a sample midcap portfolio's financials exposure — can overturn assumptions drawn from headline sector weights, and how custom thematic lenses (e.g., defensive equity, cloud computing) can highlight strategic traits that standard classifications miss. Kenney concludes that in a crowded market, managers who use these more granular data tools to shape their own narrative — rather than ceding it to generic classification systems — are better positioned to stand out.
The Best Story Wins: The Power of Presenting Data in New Ways
A discussion of shifting energy-sector dynamics and how the Syntax Power Solutions Index is constructed to give investors targeted exposure to that transition.
The Future of Energy and the Syntax Power Solutions Index
Kenney argues that investors underestimate how much fees really cost them, since the bigger hit isn't the fee itself but the compounded returns lost on that money over time. Using a hypothetical $100,000 invested in the S&P 500, he shows that a 1.25% all-in fee over 30 years costs an investor far more in lost compounding than in fees actually paid, with the combined effect wiping out roughly 30% of the portfolio's potential value. He calculates that trimming the fee by just a quarter point, from 1.25% to 1.00%, would save an investor about 120% of their original investment over three decades. Kenney closes by pointing to Syntax Direct, his firm's direct-indexing platform, as a way advisors can lower these costs for clients without cutting their own margins.
The Hidden Cost in Investing: Negative Compounding & the Opportunity Cost of Fees
Kenney argues that client service is far more layered than a simple satisfaction rating, shaped by both visible factors (like whether a client's issue gets resolved) and hidden ones (like a firm's internal systems and staff training). He outlines the broader forces that shape service quality generally, including how scalable person-to-person interactions are, how many products a firm offers, and firm-level factors like turnover and staffing. For investment advisors specifically, he points to the added strain of managing client emotions during market downturns and periods of underperformance. Drawing on his own experience as a plan sponsor, consultant, and investment manager, he identifies the personal traits he sees behind strong client service, describing it as an intuitive sense of when to reach out and a steady rhythm in the relationship. He closes with practical suggestions for advisory firms: survey clients directly, recognize that service expectations shift over time, invest in technology and data capabilities, monitor which relationships are at risk, and stay grounded in the client's own perspective.
The Multi-Faceted Nature of Client Service for Investment Advisors and Managers
An ESG-focused primer on the nine planetary boundaries framework, connecting climate change and biodiversity loss to the considerations advisors and asset owners weigh in sustainable index construction.
The Nine Planetary Boundaries: Climate Change & Biodiversity Loss
Kenney examines SpaceX's anticipated IPO, expected to target a valuation near $1.75 trillion and rank as the largest offering in history, well ahead of Saudi Aramco's 2019 debut. He describes how SpaceX has grown beyond its Starship and Falcon rocket business into a broader conglomerate spanning Starlink, its Starshield defense unit, and a new push into computing infrastructure through xAI. Drawing on the Syntax Private Market Universe, he shows SpaceX alone makes up 24% of that $5.5 trillion universe of tracked private companies, roughly half a trillion dollars ahead of OpenAI. He notes that removing SpaceX from the picture sharply reshapes sector composition, with technology's share rising and industrials' share collapsing. Kenney also flags a looming index-methodology question: standard float-adjusted rules would give SpaceX a public listing weight far below its full valuation, prompting index providers like Nasdaq and FTSE Russell to consider faster inclusion rules for mega-cap listings. He closes by suggesting that SpaceX's IPO, along with expected offerings from OpenAI and other large private companies, will test how public indexes adapt to absorb trillion-dollar entrants.
The Trillion-Dollar Launch: How SpaceX’s Path to Public Markets Redefines the Private Universe
Kenney argues that SpaceX's IPO filing revealed a fundamental misclassification: despite being widely seen as an aerospace and defense company, its actual revenue profile is that of a telecommunications business. He points to the Form S-1 disclosure showing Starlink generated $11.4 billion in revenue in 2025, 61% of the company's total and far ahead of the $4.1 billion launch segment, while also being by far the most profitable division, posting over $4.4 billion in operating income against losses in the core space and newly integrated xAI/compute segments. Kenney frames this as evidence that SpaceX has effectively become a high-margin, subscription-driven connectivity company, with its historic rocket business now functioning as a supporting piece of that broader network. He also covers SpaceX's pending $60 billion acquisition of Anysphere (Cursor), structured to close after the IPO, which adds roughly $4 billion in annualized software revenue and pushes the company further into direct competition with AI labs like Anthropic, OpenAI, and Google. He concludes that SpaceX is becoming a multi-sector conglomerate that resists simple classification, and positions Syntax's data and analysis as well-suited to track and codify the company's evolving business mix once post-merger financials are available.
Transparency in Action: How Syntax Data Provided Investors Insights Into SpaceX
'Two biggest real estate trends in one graph' — Data center spending set to overtake office space for the first time
An examination of cybersecurity as an expanding investment theme, exploring the structural demand drivers behind the sector and how targeted index exposure can capture that growth.
Understanding the Growing Investment Opportunity in Cyber Security
A look at how direct indexing and ETFs coexist in advisor portfolios, weighing the tax-management and customization advantages of direct indexing against the simplicity of ETF wrappers.
Where Do We Go From Here: Direct Indexing and ETFs
Will strategic investments in healthcare be a short-lived trend or he new normal?
M.S.F. (Master of Science in Finance) in Finance
Four decades of experience in asset allocation for corporate pension, institutional, and private clients.
Worked on asset-liability management initiatives at NEPC, including use of the PFaroe platform with Rush University Medical Center.
Managed Ford Motor Company's U.S. Defined Benefit Plan and led NEPC's Corporate DB consulting practice.
Corporate Defined-Benefit Plan Management
Since 2021, focused on direct-to-index and custom-indexing solutions for advisors and institutional clients at Syntax Advisors/Syntax Data.
Leads product development and client solutions for direct/custom indexing fintech offerings at Syntax Data.
Advised institutional investment committees on manager selection throughout his career at NEPC and beyond.
Risk management expertise spanning corporate pension oversight and institutional consulting.
M.S.F. (Master of Science in Finance), Finance
Paul Kenney, CFA, is an accomplished investment executive and advisor with 40 years of experience in asset allocation, manager selection, risk management, fintech innovation and emerging technology.
Manager, U.S. Defined Benefit Plan at Ford Motor Company
Managed Ford Motor Company's $35 billion U.S. Defined Benefit pension plan; also served as portfolio manager for multi-billion dollar annuity and bond portfolios.
Partner; Detroit Office Lead; Team Leader, Corporate DB & Healthcare Practices at NEPC, LLC
Partner and Detroit office lead at NEPC, LLC; Team Leader for the firm's Corporate Defined Benefit and Healthcare consulting practices, advising institutional investment committees on asset allocation and manager selection.
Partner; Detroit Office Lead; Team Leader, Corporate DB & Healthcare Practices
Managing Director, Product Development and Client Solutions at Syntax Advisors, LLC
Joined Syntax Advisors, LLC as Managing Director of Product Development and Client Solutions, announced via Business Wire on May 5, 2021.
Managing Director, Product Development and Client Solutions
Currently leads Syntax Data's public and private client solutions and its published research efforts, with a focus on direct and custom indexing.
CFA charterholder, reflecting his background in institutional asset management, pension consulting, and index-based investment solutions.
Advises investment managers, fintech firms, and family offices through River Road Advisors LLC.
Paul Kenney, CFA, is an accomplished investment executive and advisor with 40 years of experience in asset allocation, manager selection, risk management, fintech innovation, and emerging technology. He managed Ford Motor Company's $35 billion pension plan, was a partner and practice leader at NEPC, LLC, and now leads client solutions and research at Syntax Data.
Paul Kenney is an accomplished investment executive and advisor with 40 years of experience in asset allocation, manager selection, risk management, fintech innovation and emerging technology.
Kenney managed Ford Motor Company's U.S. Defined Benefit Plan prior to 2002.
Kenney was a Partner at NEPC, LLC from 2002 to 2021, leading its Detroit office.
Kenney advises investment managers, fintech firms, and family offices through River Road Advisors LLC.
Kenney's current employer, where he serves as SVP, Client Solutions.