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Stewardship Grade

 Morningstar's Stewardship Grade for funds goes beyond the usual analysis of strategy, risk, and return. The Stewardship Grade allows investors and advisors to assess funds based on factors that we believe influence the following:

  • The manner in which funds are run
  • The degree to which the management company's and fund board's interests are aligned with fund shareholders
  • The degree to which shareholders can expect their interests to be protected from potentially conflicting interests of the management company.

We assign each fund a letter grade from A (best) to F (worst). Funds are graded on an absolute basis. There is no "curve."

Morningstar analysts' evaluation of five factors determine the grade for each fund:

  • Regulatory Issues
  • Board Quality
  • Manager Incentives
  • Fees
  • Corporate Culture

Morningstar's Stewardship Grade for funds is entirely different from the Morningstar Rating for funds, commonly known as the Star Rating. There is no relationship between the two.

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