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Methodology Documents

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Methodology Documents

A structured product (also called a structured note) is an investment product that combines a debt issuance with embedded derivatives to create customized payoff profiles. Structured products may have coupon interest and/or principal repayment dependent on the value or return of one or more assets.
Methodology Documents

The Morningstar Categories for funds in the Europe/Asia/Africa universe were first established in the early years of the UCITS (Undertaking for Collective Investment in Transferable Securities) Directive to help investors make meaningful comparisons between Investment funds.
Methodology Documents

Here we explore our quantitative equity ratings, which are empirically driven and based on the proprietary ratings our analysts are already assigning to stocks.
Methodology Documents

With the introduction of the Morningstar Quantitative Rating, we're extending a useful analytic tool to thousands of funds not covered by Morningstar's analyst team.
Methodology Documents

The methodology provides information about the currency exposure of the assets and liabilities in which a portfolio is invested.
Methodology Documents

Questions and answers for this methodology, which provides information about the currency exposure of the assets and liabilities in which a portfolio is invested.
Methodology Documents

The grades in the Global Investor Experience Fees and Expenses study were based on responses to six questions in a fixed-response survey completed by in-house, market-expert analysts, plus other inputs determined quantitatively by leveraging Morningstar's comprehensive and extensive global database of managed products.
Methodology Documents

Morningstar created extended performance statistics to “fill in the gap” between the inception date of a new share class or distribution channel and the inception date of the original portfolio. Extended performance lengthens the performance data that is available for the younger investment. This helps investors see how the portfolio as a whole has performed over time.
Methodology Documents

A risk model forecasts the distribution of future asset returns. Several features make the Morningstar Risk Models unique.
Methodology Documents

The EU's sustainability finance disclosure regulation, or SFDR, mandates that certain financial market participants have to disclose the principal adverse impacts, or PAIs, of their holdings.
Methodology Documents

The EU's sustainability finance disclosure regulation, or SFDR, mandates that certain financial market participants have to disclose the principal adverse impacts, or PAIs, of their holdings.
Methodology Documents

The updated style box provides an intuitive visual representation of style that helps investors build better portfolios and monitor them more accurately.
Methodology Documents

EU-domiciled funds (or funds sold into the EU) must calculate and disclose their portfolio's alignment with the EU taxonomy by providing an aggregation of the alignment of the underlying holdings. This methodology paper describes the calculation of those fund-level metrics.
Methodology Documents

Using the Sustainalytics ESG Impact Framework, Morningstar introduces new impact metrics to help investors evaluate a company's environmental and social impacts, as well as how these play out within an investor's portfolio.
Methodology Documents

In March 2004, Morningstar introduced the category classification methodology for Chinese mutual funds. Since that time, there have been significant developments in the Chinese financial market as well as an increase in both the quantity and variety of fund products.
Methodology Documents

The Morningstar Sustainability Rating is designed to support investors in evaluating the relative environmental, social, and governance risks within portfolios.
Methodology Documents

This document explains the methodology behind Morningstar Portfolio Risk Score for evaluating portfolios and determining if they align well with the asset allocations of the Morningstar Target Allocation Indexes.
Methodology Documents

The Morningstar Rating for Funds Methodology provides the theoretical basis and calculation logic for the quantitative star rating.
Methodology Documents

Until now, we have been refreshing our flows models on an ad-hoc basis. Now we have implemented the fund flows model into Morningstar products so these insights can be gleaned in a live setting.
Methodology Documents

Morningstar identifies a Primary Share in Market for open-end funds and exchange-traded funds. This is a proprietary data point and the primary share class is identified by the application of a set of hierarchal criteria.
Methodology Documents

Methdology explaining the Morningstar portfolio level calculations for EU taxonomy
Methodology Documents

Using corporate legal filings in the United States, United Kingdom, and Canada, Morningstar introduces new gender diversity metrics to help investors evaluate the gender diversity breakdown of officers and boards of directors for public companies as well as portfolios.
Methodology Documents

Morningstar Category classifications sorts portfolios into peer groups based on their holdings. The categories help investors identify the top performing funds, assess potential risk, and build well-diversified portfolios. Here is how those categories are decided upon and funds assigned to them.
Methodology Documents

In March 2004, Morningstar introduced the category classification methodology for Chinese mutual funds. Since that time, there have been significant developments in the Chinese financial market as well as an increase in both the quantity and variety of fund products.
Methodology Documents

The Morningstar Globe Rating for companies is a visual representation of the Sustainalytics ESG Risk Classification that will allow investors to easily identify securities with low ESG risk.
Methodology Documents

The Globe Rating for companies is a visual representation of the Sustainalytics ESG Risk Classification that will allow investors to easily identify securities with low ESG risk.
Methodology Documents

In this updated and expanded report, we build upon our original examination of synthetic exchange-traded funds in Europe, describing how the split between physical and synthetic ETFs in Europe has evolved in the past decade, citing the causes for the fall in popularity of the synthetic structure and why investors are again expressing interest in it for exposure to mainstream US equity indexes.