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Morningstar's Take on 2021

Our analysts and specialists put the year in stocks, funds, and portfolios into perspective.

Only time will tell what investors remember most about 2021. Perhaps it’ll be the ebullient stock market--or the fading FAANG market. Many will likely remember 2021 as the year that inflation returned with some fury. Others will say it was the year of Bitcoin, meme stocks, and Cathie Wood.

Whether you're new to the market or a seasoned hand, an accumulator saving for retirement or someone who's already there, this year-end review is for you. The report brings together insights and perspective from our analysts and specialists about the markets, stocks, funds, and portfolios in 2021.

Markets & The Economy

The Stock Market Faces Strong Headwinds in 2022 We see opportunity in smaller companies and value stocks today. 2022 Economic Outlook: Recovery Far from Finished Inflation and Omicron shouldn't derail growth this year.

Forget Value vs. Growth--Size Drove Returns in 2021 Six charts showing how market cap drove returns.

2021 Market Performance in 8 Charts U.S. stocks post third year of double-digit gains but bonds falter.


33 Undervalued Stocks for 2022 Here are our analysts' top ideas in each sector for the new year.

The 10 Best Wide-Moat Stocks of 2021 Do any of this year's top performers have gas left in the tank for 2022?

The Best Stocks of 2021 in Morningstar's Coverage List Moderna and BioNTech were among a top performers list dominated by tech, energy, and consumer names.

The Biggest IPOs of 2021 In a year with a record number of public debuts, these companies stand out.

Sector Outlooks

Healthcare Stocks Dogged by U.S. Policy Concerns Large biopharma names are undervalued while device and diagnostic industries look pricey.

Is the Worst Yet to Come for Utilities? Inflation weighs on earnings, balance sheets, and real yields, but growth opportunities remain.

Despite Outperformance in 2021, Energy Stocks Look Undervalued The oil services segment looks especially cheap.

Plenty of Opportunity in Communication Services Sector Alphabet continues to power ahead, masking underperformance of the group.

Basic Materials Stocks Look Expensive After a strong performance in 2021, the sector offers little opportunity today.

Financial Stocks Look Rich, but Macro Uncertainties Unlock Some Bargains Concerns about inflation, monetary policy, and interest rates dinged performance during 2021's fourth quarter.

Which Consumer Defensive Firms Can Withstand Inflation? The market underappreciates consumer packaged goods manufacturers.

Travel and Leisure Stocks are Ripe for Investment in 2022 Despite supply chain constraints, rising labor costs and new variants, we still see value in the consumer cyclical space.

Where are the Bargains in Tech in 2022? We remain bullish on the key secular trends in technology but think the sector overall is a little pricey.

Real Estate Rebounds The sector currently trades in line with our fair value estimates.

Chain Disruptions, Labor Shortages Hampered Industrials Stocks in 2021 The sector looks overpriced to us today, but there are a few bargains to be had.


The Year in U.S. Stock Funds Value is back.

A Mixed Bag for International Funds in 2021 Elation over economic recovery balanced unease about the future.

2021: The Year in Bond Funds Credit risk prevails in a rocky year for bond markets.

Vanguard in 2021--and Beyond Morningstar's Vanguard specialist recaps the year that was and talks about what may be in 2022.

Fidelity in 2021 and Beyond Morningstar's Fidelity specialist recaps the year and looks forward to 2022.

T. Rowe Price in 2021 and Beyond Morningstar's T. Rowe Price specialist reviews the fund flows, performance, and other news from 2021.

2021 Fund Flows Winners and Losers Some asset managers did a better job than others attracting new investors this year.

How Did Inflation-Protection Strategies Perform in 2021? Morningstar's multi-inflation strategies specialist puts performance in perspective, discusses best practices, and shares our top picks.

The Year in ETFs It was a record year for ETFs in 2021. Will 2022 be more of the same?

The Year in Funds From flows to performance and more, tied up with a bow.


Portfolio Lessons from 2021 Key takeaways about inflation, asset allocation, and more.

My Top 10 Portfolio Highlights from 2021 Some long-running trends continued, but rising inflation and the specter of higher interest rates prompted a few reversals.

How Did the 60/40 Portfolio Do in 2021? 'The reports of my death are greatly exaggerated,' says the asset-allocation standard.

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