Methodology Documents

Morningstar has conducted research on active and passive investment strategies and their associated vehicles since 1986.

This paper outlines the key assumptions and details behind our quantitative equity rating methodology.

We believe that a company's intrinsic worth results from the future cash flows it can generate. The Morningstar Rating for stocks identifies stocks trading at a discount or premium to their intrinsic worth--or fair value estimate, in Morningstar terminology.

This document describes the rationale for, and the formulas and procedures used in, calculating the Morningstar Rating for funds (commonly called the “star rating”). This methodology applies to funds receiving a star rating from Morningstar.

This paper outlines the key assumptions and details behind our quantitative equity rating methodology.

Morningstar developed the Morningstar Equity Comparables system to give investors and financial professionals an objective benchmark for comparing companies. Morningstar Equity Comparables is genuinely different to other industry classification schemes. We start from the bottom up with comparable companies, as opposed to the top down with sector definitions. For every pair of companies, we determine how similar they are–anywhere from closely comparable to distantly related based on automated analysis of the companies' own business description. We automatically analyse the text of the business description and work out whether companies are talking about similar things as they describe their businesses. Businesses described in similar terms are comparable.

The coronavirus pandemic is already delivering eye-popping economic data, with the U.S. unemployment rate reaching 15% in April, the worst number since the Great Depression. Despite the inflow of very bad data, equity markets have rallied over the past s

ESG funds show resilience during COVID-19 sell-off.

The following paints a picture of the recent growth and trends within sustainable investments in Canada, inclusive of a summary of Morningstar’s updated framework for identifying sustainable funds.

Explanation of the methodology behind the Morningstar distribution analysis fields.

The Morningstar Category™ classification system for funds lets institutions, advisers and investors effectively compare like funds.

The Morningstar Category™ classification system for funds lets institutions, advisers and investors effectively compare like funds.

This methodology is applied to HK MPF Funds.

Morningstar Category classifications sorts portfolios into peer groups based on their holdings. The categories help investors identify the top performing funds, assess potential risk, and build well-diversified portfolios. Here is how those categories are

Morningstar Category classifications sorts portfolios into peer groups based on their holdings. The categories help investors identify the top performing funds, assess potential risk, and build well-diversified portfolios. Here is how those categories ar

While the circumstances of this market crash might be unique, are such drops normal for equity markets, or is this time different?

Hong Kong and Taiwan shone as well.

A better way to understand client’s risk preference in the context of investing well.

We forecast a 2.9% drop in U.S. 2020 GDP; our base case includes a second-quarter shutdown but effective treatment in the second half.

The Morningstar Fee Level for mutual funds was developed to help investors compare an investment vehicle's relative level of fees with those of similar investment vehicles. There are four different fee levels: Morningstar Fee Level--Broad, Morningstar Fe

Morningstar is undertaking a multistage effort to assess the current landscape and educate the investment community on manager intentionality toward ESG, or sustainable investing. The first stage of this effort is the launch of two sets of intentionality

Morningstar is undertaking a multistage effort to assess the current landscape and educate the investment community on manager intentionality toward ESG, or sustainable investing. The first stage of this effort is the launch of two sets of intentionality

The Homochronic Recessed Smoothing Ensemble and Corrective Autoregression Transfer function methodology provides a general framework for electricity load and price forecasts.

Hopes of a "Phase One" trade deal between the U.S. and China have lifted Chinese equities for the past several months, and a deal was finally inked on Jan. 16. However, the deal doesn't materially change our outlook for China's economic growth, especiall