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ETF Specialist

Rating Foreign Small-Cap Index Funds

An updated review of process and price led to some changes in these Morningstar Analyst Ratings.

Mentioned: , ,

Morningstar rates three exchange-traded funds in the foreign small/mid-blend Morningstar Category, and earlier this year the Morningstar Analyst Ratings for all three changed.  iShares MSCI EAFE Small-Cap ETF (SCZ) dipped to Neutral from Bronze,  Schwab International Small-Cap Equity ETF  (SCHC) improved to Bronze from Neutral, and  Vanguard FTSE All-World ex-US Small-Cap ETF (VSS) was downgraded to Bronze from Silver. These changes were necessary to resolve previous inconsistencies in the application of the ratings framework across these three funds.

The Morningstar Analyst Ratings reflect our level of confidence in a fund’s ability to outperform its category peers on a risk-adjusted basis over a full market cycle. This assessment rests on the same five pillars used to evaluate mutual funds: Parent, People, Performance, Process, and Price.

Daniel Sotiroff has a position in the following securities mentioned above: SCHC. Find out about Morningstar’s editorial policies.