Wall Street Wants to Sell a Special Index, Just for You

It’s the existential challenge faced by asset managers all over Wall Street: Surrender to the fee-killing exchange-traded fund boom—or keep bleeding assets and risk extinction. Now they’ve hit on a way to fight back.

Investment giants are lavishing billions of dollars in a bet that they can bring the personal touch back to an investing world dominated by mass-market index funds. They include Morgan Stanley and even dominant ETF and index players BlackRock and Vanguard Group. They’re all racing to offer software that can create a unique index for every investor and then let them buy all the shares ...