A Closer Look at Morningstar's Four Stock Portfolios
Their philosophy, portfolio strategy, and portfolio composition.
Nothing focuses the mind like the prospect of being hanged in a fortnight, and nothing focuses the investment mind like the prospect of allocating capital between two or more investments. That's one reason we now have four stock portfolios--the Tortoise and Hare portfolios, the Growth Portfolio, and the Dividend Portfolio--based on the research produced by Morningstar's team of equity analysts.
In these portfolios, we sift through our high-rated stocks and make decisions about which ideas are most compelling, and how much of a portfolio's capital to allocate to each holding. Now, there's nothing wrong with simply picking stocks from our 5-star list. The issue is that we currently have 79 5-star stocks--a lot to choose from, and certainly more stocks than most investors want to own or monitor. Plus, stocks enter and leave our 5-star list every trading day. Finally, those 79 stocks represent only 5% of our coverage universe of almost 1,700 stocks; the market isn't particularly cheap these days. If the market slid, you could easily see hundreds of 5-star stocks, which would make building a portfolio out of the 5-star stocks an even tougher challenge.
Haywood Kelly, CFA has a position in the following securities mentioned above: KMX. Find out about Morningstar’s editorial policies.
Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.
We’d like to share more about how we work and what drives our day-to-day business.
We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.
How we use your information depends on the product and service that you use and your relationship with us. We may use it to:
To learn more about how we handle and protect your data, visit our privacy center.
Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.
To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.
Read our editorial policy to learn more about our process.