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.

Disagreement among managers on disclosures about Scope 3, and on political and societal issues.

How are individual investors thinking about trendy asset classes?

The EU taxonomy is a classification system of environmentally sustainable activities that require large EU corporations to disclose information that indicates how aligned the company's revenue, operating expenditure, and capital expenditure are to the EU

The paper contains data and product information about Morningstar Australia Equity Research Coverage

Analysis of the Morningstar Emerging Markets Index reveals compelling valuations, potential catalysts, and some diversification benefits.

Global open-end and exchange-traded funds had USD 66 billion of estimated net flows in 2023, a weak recovery following outflows in 2022.

Investors pull record money from Article 8 funds, while Article 9 funds suffer first-ever quarterly outflows.

First quarterly outflows on record, while passive funds continue to attract new money.

Why investors continue to work with their financial advisors.

Morningstar sustainability indexes' mixed performance can be blamed on ESG risk within the 'Magnificent Seven.'

Persisting beyond alpha-decay and the efficient-market hypothesis: Momentum remains pervasive and relevant.

Simulating fund performance during market turbulence.

Voting records for the largest U.S. and European managers reveal greater divergence in 2023.

An early analysis of what the U.K. sustainability-labeled funds market may look like.

The technology sector's dramatic 2023 rebound opens up opportunity in other areas of the equity market.

The Morningstar Risk Model is a holdings-based model that helps “identify and assess the risk in one’s investments.

A framework for responsible adoption of large language models.

The paper contains information about Morningstar Manager Research Coverage in Australia & New Zealand

Data Content Guide

Morningstar Indexes' insights into market leadership, the impact of macroeconomic factors on assets, and diversification.

Inside the world of precious-metals equities.

Empowering investor success.

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

Stricter rules may force up to 45% of ISR funds to divest EUR 7 billion worth of oil and gas companies.

Stronger fixed-income returns boost starting safe withdrawal percentages to 4%, their highest level in three years.

Data Content Guide

Over the past several years the battery technology space has been evolving rapidly, driven by growth of consumer electronics, electric vehicles, and energy storage solutions for renewable power generation and grid stability.

Morningstar has conducted qualitative, analyst-driven research on 529 plans since 2004 and rated plans since July 2012. An essential complement to our database of investment information and our suite of quantitative research tools, such as the Morningsta

Inflows decrease further amid gloomy markets, but Europe continues to show resilience.

Article 8 fund outflows continue, while Article 9 funds lose appeal amid market and regulatory turbulence.

In this research, we home in on common advisor behaviors to identify which actions may unintentionally trouble clients and damage the advisor-client relationship.