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.

All-time high flows, paired with positive returns, lifted assets in target-date mutual funds above $1 trillion in 2017. This year's report covers recent developments in the competitive landscape, and then it highlights noteworthy considerations for targe

Investing in the wide-moat stocks of today and tomorrow

U.S. President Donald Trump recently shook up global financial markets by announcing plans to enact import tariffs of 25% on steel and 10% on aluminum. The exact form these tariffs will take remains unclear. We've updated our forecasts and fair value est

The paper outlines category definitions applicable to the New Zealand market.

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

The paper defines the Morningstar Categories for the Japan-domiciled open-end funds.

The paper outlines category definitions applicable to the Mexican market.

The paper outlines category definitions applicable to the Mexican market

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

New Year, Not-So-New Trends in Flows

Quality recommendations for current income and income growth from stocks.

Investing in the wide-moat stocks of today and tomorrow

To receive safe harbor regulatory protections, defined-contribution plan sponsors must, among other things, follow a prudent process for selecting a qualified default investment alternative. This includes considering the specific demographics of the part

This methodology addresses the assumptions and formulas used in calculating the Total Return. This methodology is only applicable to interest rate series that are updated at a daily frequency. It is intended for interest rate indices with one or less yea

Quality recommendations for current income and income growth from stocks.

Investing in the wide-moat stocks of today and tomorrow

Quality recommendations for current income and income growth from stocks.

Taxable bond was once again the Morningstar category group with the largest inflows last month, as investors sought to lock in the gains of an almost-nine-year bull market and continued to rebalance from stocks to bonds.

Investing in the wide-moat stocks of today and tomorrow

We draw on results from a survey of U.S. adults to create a model of financial health. Using demographic, psychographic, emotional, and behavioral variables, we show that financial behavior and emotional well-being are affected by two simple mental facto

An $8.7 billion inflow is impressive for a category group that’s usually in outflow territory. Investors poured $27.6 billion into passive U.S.-equity funds last month, more than doubling the previous month’s $12.7-billion inflow. U.S. GDP growth has bee

Quality recommendations for current income and income growth from stocks.

Investing in the wide-moat stocks of today and tomorrow

Quality recommendations for current income and income growth from stocks.

Despite expectations of rising rates, taxable bond was once again the most popular category group in September with $34.9 billion in flows overall, significantly higher than the $27.5 billion it had received in August. In a reversal from the previous mon

A guide to the Morningstar classification system for Fixed Income, cash and cash equivalents. This methodology document addresses the Morningstar global fixed income classification.

Investing in the wide-moat stocks of today and tomorrow

Taxable bond remained the leading category group in August with $27.5 billion in flows overall. Unlike in June and July, however, active taxable-bond flows surpassed passive ones: $14.1 billion versus $13.3 billion.

Quality recommendations for current income and income growth from stocks.

Investing in the wide-moat stocks of today and tomorrow