Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research, today announced Morningstar Analyst Rating™ changes for several U.S. funds. The Morningstar Analyst Rating for funds represents Morningstar’s conviction in the fund’s ability to outperform on a risk-adjusted basis over the long term. The five-tiered, qualitative Morningstar Analyst Rating scale has three positive levels, indicating Morningstar Medalists—Gold, Silver, and Bronze—in addition to Neutral and Negative ratings.
In July, Morningstar analysts upgraded two U.S. fund ratings, downgraded seven fund ratings, and assigned five new ratings. As of July 31, 2014, 156 U.S. funds had a Morningstar Analyst Rating of Gold, 292 funds had a Silver rating, 319 funds were rated Bronze, 346 funds had a Neutral rating, and 37 funds were rated Negative. Approximately 10 percent of mutual funds available for sale in the United States are currently Morningstar Medalists. Morningstar’s manager research team covers about $8 trillion of U.S. investor assets, which is equivalent to approximately 70 percent of total investor assets in the United States.
Morningstar upgraded the following U.S. mutual funds in July:
• JPMorgan Equity Income Select Fund, upgraded to Silver from Bronze
• TIAA-CREF Large-Cap Value Fund, upgraded to Bronze from Neutral
Morningstar downgraded the following U.S. mutual funds in July:
• Calamos Market Neutral Income, downgraded to Neutral from Bronze
• Franklin Rising Dividends Fund, downgraded to Neutral from Bronze
• MainStay ICAP International, downgraded to Bronze from Silver
• MainStay High Yield Corporate Bond, downgraded to Neutral from Bronze
• Thornburg International Value Fund, downgraded to Bronze from Silver
• Vanguard Total Bond Market Index, downgraded to Silver from Gold
• Wasatch Long/Short Fund, downgraded to Bronze from Silver
Morningstar assigned new Analyst Ratings for the following U.S. mutual funds in July:
• BlackRock Global Long/Short Equity Fund—assigned new rating of Neutral
• Franklin Strategic Income Fund—assigned new rating of Bronze
• PIMCO StocksPLUS Absolute Return Short Strategy Fund—assigned new rating of Neutral
• Vanguard Large Cap Index Fund—assigned new rating of Gold
• WCM Alternatives Event-Driven Fund—assigned new rating of Bronze
• DoubleLine Total Return—designated as Not Ratable because of insufficient information supplied by DoubleLine. Morningstar previously assigned a Neutral Analyst Rating to the fund.
A summary of last month’s Morningstar Analyst Rating changes for U.S. mutual funds is available on Morningstar.com in the latest Fund Spy: Medalist Edition here.
Morningstar launched its Analyst Rating for funds and Global Fund Reports in November 2011. Morningstar Medalists—Gold-, Silver-, and Bronze-rated funds—are funds that analysts determine are likely to outperform their peer groups and/or relevant benchmarks on a risk-adjusted basis over a market cycle of at least five years. The differences between the positive Medalist ratings indicate the level of the analyst’s conviction in a fund’s future performance. Analysts arrive at a rating through an evaluation of five key pillars: People, Process, Parent, Performance, and Price. The Analyst Rating methodology is available here.
To view a complete list and supporting analysis for Analyst Ratings for U.S. funds, please visit www.morningstar.com. Premium Members have access to a Morningstar Medalists screener, where users can sort funds by Morningstar Rating, Morningstar Analyst Rating, Fund Family, Manager Tenure, Expense Ratio, and other metrics. Morningstar’s Global Fund Reports, in-depth research reports that include a wealth of data and analysis, are available in Morningstar DirectSM, the company’s web-based global investment analysis platform for institutional investors, and in Morningstar OfficeSM, a global practice and portfolio management solution for advisors.
Morningstar has approximately 100 manager research analysts worldwide who cover approximately 4,300 funds. The company provides data on approximately 172,000 open-end mutual funds, 8,000 closed-end funds, and 10,900 exchange-traded product listings as of June 30, 2014.