Morningstar Runs the Numbers

Inspired by Harper's Index (with a tip of the hat to FiveThirtyEight's Significant Digits blog), Morningstar Runs the Numbers uses a numbers-based approach to highlight recent Morningstar research, along with some outside news stories.

42%

Wide moat-rated

4 Rising interest rates have held back returns in most domestic bond categories in 2018, but the bank-loan category is in the black for the year to date. Fixed-income manager research analyst Brian Moriarty discusses some of the performance drivers and four of our analysts' picks in the category.

5 It isn't easy for a fund to earn a Morningstar Analyst Rating of Gold. The fund must rate highly on nearly all five Pillars: People, Process, Price, Parent, and Performance. The manager has to be experienced, and the supporting team must also have sufficient experience, skill, and stability. Director of manager research Russ Kinnel profiles five funds that we recently upgraded to Gold.

4 While precision, strength, and unwavering stamina are vital to athletic careers, what sets apart the world's greatest athletes comes down to underlying values that have nothing to do with sports, says motivational speaker and New York Times bestselling author Don Yaeger. According to CNBC, as a Sports Illustrated journalist Yaeger met many sports legends, including football player Walter Payton and basketball coach John Wooden; he said the best among them all exhibited these four traits.

4 Morningstar equity analysts' opinions of whether a stock is undervalued or overvalued often don't jibe with consensus opinion. Sometimes a majority of Wall Street analysts thinks a stock is a strong buy, but our analysts aren't quite as bullish. The average analyst price targets for these four companies indicate that the consensus views the stocks as fairly valued or even a bit undervalued. But Morningstar analysts believe the same stocks are very overvalued.

0.52% Morningstar senior manager research analyst Patty Oey published a study of U.S. open-end mutual funds' and exchange-traded funds' expense ratios. She found that the asset-weighted average fee across funds was 0.52% in 2017, an 8% decline from 2016. This is the largest year-over-year decline we have recorded since we began tracking the trend in asset-weighted average fees in 2000. Consequently, we estimate that investors saved roughly $4 billion in fund expenses last year. This fee decline is a big positive for investors because fees compound over time and diminish returns, Oey said.

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