Morningstar Fund Ratings: Weekly Round-up

ANALYST RATINGS: This week, fund analysts reveal new ratings for Brandes and Standard Life Investments and a downgrade for Vanguard

Morningstar Analysts 26 February, 2018 | 2:56PM

New Ratings

Brandes European Value – Silver

Mathieu Caquineau

Brandes European Value benefits from a consistent deep-value approach in the hands of experienced investors. This fund is managed by a seasoned and stable five-person investment committee. There’s been little turnover on the broader team that directly supports them through in-depth fundamental research. The team looks patiently for bargains and has a very long-term investment horizon. This approach has delivered robust relative returns in the long run. An investor-friendly parent and attractive fees add to the fund’s appeal. We have therefore awarded it a Morningstar Analyst Rating of Silver.

SLI Global Smaller Companies – Bronze

Peter Brunt

Building on the long-standing ‘Focus on Change’ investment approach, we have reason to believe that SLI Global Smaller Companies--Standard Life Aberdeen's first entry into the global small-cap space--stands as a strong option for investors seeking exposure to smaller companies globally. With the support of a seven-strong small-cap team, headed by the highly experienced Harry Nimmo, fund manager Alan Rowsell has managed to add value through strong stock selection since launch in 2012. Despite slightly higher-than-average fees, we are confident in the fund’s ability to outperform in the long-run.

Downgrades

Vanguard UK Government Bond Index – Silver

Jose Garcia-Zarate

A low-cost passive approach to gain access to the market of UK conventional government bonds makes sense, and the Vanguard UK Government Index Fund remains an above-average investment proposition. For this market exposure, we have a slight preference for the float-adjusted index approach that this Vanguard fund follows, as it provides a more accurate representation of what is available for investors to buy in the secondary market.

However, irrespective of benchmark, the structural long-dated issuance bias of the UK government-bond market creates room for active managers to play around with duration. For this reason, we conclude that a Morningstar Analyst Rating of Silver, rather than the previously assigned Gold, better conveys our level of conviction on this fund’s ability to deliver risk-adjusted returns above the Morningstar Category average over the long term.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article
Security NamePriceChange (%)Morningstar
Rating
Brandes European Value I GBP30.14 GBP-1.32
SLI Global Smaller Companies Pltfm 1 Acc149.50 GBP0.27
Vanguard UK Govt Bd Idx GBP Acc164.00 GBP0.33
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