U.S. Morningstar Awards for Investing Excellence: The 2023 Winners

Today, Morningstar announced the 2023 winners of the U.S. Morningstar Awards for Investing Excellence.

BlackRock’s Rick Rieder won the Outstanding Portfolio Manager award, and Capital Group, the parent company of the American Funds, took the Exemplary Stewardship prize.

Morningstar’s manager research analysts chose the winners from a shortlist of nominees who have distinguished themselves not only by their outstanding long-term returns but also by developing and adhering to sound processes and shareholder-friendly philosophies that will endure. All the Outstanding Portfolio Manager nominees hailed from strategies that earn Morningstar Analyst Ratings of Silver or Gold for at least one vehicle or share class. Their successful track records spanned multiple market cycles, and they each invested a lot of their own money in their strategies. The Exemplary Stewardship nominees each had Parent Pillar ratings of High, which is reserved for the most reliable stewards of investors’ capital. Few firms make that cut, and these candidates further stood out for nurturing investment and business cultures that make investors’ interests their paramount priority.

Here’s more detail on this year’s winners.

Rick Rieder, BlackRock

Rieder took over a fixed-income operation in 2010 that was still smarting from the global financial crisis and manager turnover and built it into one of the industry’s strongest bond investing teams. Since then, Rieder, whose strategies include BlackRock Strategic Income Opportunities BSIIX and BlackRock Total Return MAHQX, has stayed the course with a research-intensive, risk-aware approach and delivered long-term success across various market environments in multiple Morningstar Categories.

Rieder devours research and distills it into a diversified collection of small bets rather than a few large ones. He then monitors risk like a border collie patrolling for strays and wolves. Rieder is known for his insatiable and omnivorous appetite for data and command of the minute details of everything from global monetary policies to the smallest positions in the many strategies on which he is a named manager. Yet, his focus on risk control prevents him from getting too enamored with, and betting the farm on, any one idea. He also has assembled a large and talented team that should outlast him. On his watch, funds like BlackRock Total Return have beaten their average category peers and relevant benchmarks on an absolute and volatility-adjusted basis.

Capital Group (American Funds)

Capital Group, known in the United States as American Funds, built its reputation on its venerable and excellent actively managed equity funds, but the firm has prudently invested to diversify and strengthen its lineup over the years. Capital Group, for example, bolstered its less renowned fixed-income and multi-asset strategies with new tools and personnel over the past decade, helping to elevate many of them to Morningstar Medalist status. The firm, long a citadel of traditional open-end mutual funds, has also been flexible enough to meet investor demand without compromising its core investing philosophy; it launched a passel of active equity and fixed-income exchange-traded funds in 2022. The bastion of active management still resists launching its own passive funds, but it did begin overseeing active-passive model portfolios using outside index offerings in February 2023.

The firm is going through a planned leadership transition. Fixed-income veteran Mike Gitlin will succeed longtime CEO and chair Tim Armour, and other key principals will change roles. The firm, however, remains focused on preserving the hallmarks of its culture, including the signature multimanager approach on which it has relied since 1958. The structure has helped the firm balance portfolio manager autonomy with collaboration, navigate numerous manager transitions across its lineup, and absorb asset growth. Capital Group also retains a very high percentage of its managers, who also invest large sums alongside their shareholders.