Four New Ways to Screen for Top Fund Families

A handful of positive qualities tend to distinguish the best asset managers: fees, investment experience, talent retention, and product churn, as Morningstar has surfaced in prior research. 

Now, however, four new firm- or Parent-level Morningstar Medalist Rating data points are available to shine a light on each of these key areas. When used properly, these metrics can help investors cut through the noise and identify leading asset managers based on the criteria that matter most to them. 

All four data points inform how Morningstar analysts scrutinize firms, and they also serve as key inputs to quantitatively derived Parent Pillar ratings for managers not under analyst coverage. 

Here, we look at how the 100 largest US fund families scored across the board relative to their respective Parent Pillar rankings. Within that group, 81 firms currently receive qualitative analyst coverage, while 19 receive quantitative coverage.

Historical Morningstar research shows that fund fees are among the best predictors of future fund success. 

The average brand active/passive fee data point ranks share classes relative to their respective Morningstar Category peers. It also compares funds on a like-for-like basis with respect to management style—active or passive—so that passive-only managers who tend to charge much lower fees than their active counterparts aren’t the only ones spotlighted. 

Most of the parent firms with top marks offer competitively priced funds. Average brand active/passive fee ranks for eight of the 11 High-rated firms landed in the cheaper half of all fund families, with Causeway (57th percentile), MFS (55th percentile), and Pimco (53rd percentile) the only exceptions.

The average brand longest manager tenure data point highlights the experience of firms’ most seasoned veterans. When calculated in days, the raw version of this data point is easier to understand when converted to years. This metric is asset-weighted, so it emphasizes the experience level of the managers overseeing the largest pools of money. 

Experience can be a useful starting point for investors looking to find a set of steady hands to entrust their hard-earned money to. 

Even with the common practice of asset managers listing long-tenured firm leaders on funds, regardless of whether they are still involved in the day-to-day portfolio-management process, the 18.3-year average brand-longest manager tenure for High-rated Parent firms was longer than the average tenure for each of the other four ratings buckets.

The manager-retention data point complements the tenure figure, offering a more complete view of investment-team stability at a firm. 

The average brand retention ratio, calculated on a trailing five-year basis, shows which firms are doing the best job at keeping talent in-house. Like the tenure-focused data point, this one is also asset-weighted. 

All 11 High-rated Parent firms retained at least 90% of their managers (and most kept at least 95%) over the trailing five years through July 2026. Some of the top-rated specialist active managers—like Primecap (100%) and Baird (98%)—scored near the top of this list, but so did large, diversified managers like J.P. Morgan (96%), Capital Group (95%), and Fidelity (93%). 

Although some product rationalization is necessary, too much can be a negative signal. 

The average brand obsolete rate data point, also calculated on a trailing five-year basis, measures the percentage of funds that a firm shuttered. Higher figures can imply that a firm isn’t choosy enough with the products it brings to market, that its funds have fallen out of investors’ favor, or, even worse, that poor performance combined with outflows made them no longer viable.  

Only a handful of the 100 largest asset managers opted not to shut down any funds over the trailing five years through July 2026. That list included High-rated Dodge & Cox (which offers just seven funds) as well as Above Average-rated Baron Capital (23 funds, including a smattering of recently launched exchange-traded funds). 

Some churn may be healthy, though, if a firm is trying to maintain a certain standard across its lineup. The average obsolete rate over the past five years among the largest US fund managers was 3.9%. 

All told, these four firm-level data points provide clearer lenses for comparing asset managers with one another when selecting an investment strategy. Given that many investors stick with their funds across decades, choosing a parent firm that does not overcharge, is a capable steward of talent, and holds new and old products to high standards will increase their odds of long-term success. These new data points will help investors do just that. 

Explore four new firm- and Parent-level Morningstar Medalist Rating data points to evaluate fees, investment experience, talent retention, and product churn. Use the data to identify leading asset managers and strengthen your fund research.