The world’s first stockmarket index for professional services firms was launched this week at the City of London headquarters of magic circle firm Allen & Overy.

A key aim of the initiative is to educate analysts and institutional investors about the potential benefits of investing in law firms once firms are able to float and raise external capital from 2011. Institutions will be encouraged to allocate analysts to cover the sector on the back of the index and help close a perceived ‘communications gap’ between professional services firms and the City.

The MPF Professional Services Index was compiled by investment bank Noble on behalf of the Managing Partners Forum, whose chairman is Sir Nigel Knowles, joint chief executive of DLA Piper. Knowles said: ‘We want investors to appreciate the profitability, growth and resilience of professional firms. We envisage a world where: the professions are recognised as crown jewels on any stock exchange; institutions allocate analysts to cover the professions as a distinct sector; [and] funds are created to invest in the professions, using our index as the benchmark.’

For more on this story, see this week’s Gazette, published on Thursday.