Morningstar Fund Ratings: Weekly Round-up

ANALYST RATINGS: This week fund analysts reveal new ratings for Schroders and Standard Life with upgrades for Fidelity and iShares

Morningstar Analysts 10 July, 2018 | 7:28AM
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New Ratings

Schroder Global Recovery – Bronze

Peter Brunt

For those seeking a pure-value approach who have a higher tolerance to volatility, there is much to like about this strategy. It benefits from a talented management team, supported by adequate analytical resources, that follows a highly structured investment approach. Nick Kirrage, Kevin Murphy, and Andrew Lyddon have managed the strategy from launch in October 2013, since when returns have been respectable given the strong headwinds facing value investors.

While the managers’ experience is founded primarily in investing in UK equities, we note that they have been investing in overseas names on their UK equity mandates for many years. Overall, we believe that there is enough evidence that the investment approach has merit within a global context.

SLI MyFolio Managed III Inst – Bronze

Randal Goldsmith

Following a Morningstar Analyst Ratings Committee we have awarded an Analyst Rating of Bronze to the SLI MyFolio Managed III fund. MyFolio was among the first of the risk targeted fund offerings and has been managed consistently with its risk objectives throughout. As denoted by the name, the fund is part of MyFolio’s Managed range, which is invested mainly in in-house funds.

In general, the fettered fund of funds approach works well for MyFolio because Aberdeen-Standard has a broad range of offerings to choose from, and the limited use of external products enables the overall charge to be kept to a level that is competitive while offering active asset allocation from one of the best resourced multi-asset teams in the UK.


Fidelity China RMB Bond – Bronze

Don Yew

We have upgraded Fidelity China RMB Bond’s Analyst Rating to Bronze from Neutral. We have gained increased conviction in Bryan Collins, who has managed this strategy (via A-share class) since 8 December 2011, and consistently demonstrated a strong awareness of the developments/risks within the onshore China RMB bond market and how best to shape and evolve the fund’s investment strategy.

Furthermore, he is supported by a six-member Shanghai-based onshore team, includes four credit analysts, which focuses on onshore credit and is one of the most well-resourced among Asian fixed income managers under our coverage. We consider Fidelity’s superior onshore investment capabilities a key advantage given that majority of onshore credits are non-rated and require dedicated credit resource. Additionally, Collins has delivered respectable peer-relative return during his tenure.

iShares European Property Yield (IPRP) – Bronze

Kenneth Lamont

While the exclusion of UK holdings means that fund performance may deviate from its peers at times, iShares European Property Yield ETF has demonstrated its edge over long time periods. This exchange-traded fund is supported by a low fee, and we are confident that it will outperform its peers over the full market cycle. This ETF has ranked in the top quartile against its category peers, both active and passive, on a risk-adjusted basis over three and 10 years and in the second quartile over five years.

The fund's constituents must have a forecast dividend yield of at least 2%, arguably a low hurdle given the obligation for global REITs to maintain high dividend pay-out ratios. In fact, at the time of rating, the index holds 59 of the 65 securities included in the non-yield-screened parent benchmark.

The fund has an ongoing charge of 0.4%, making it significantly cheaper than the majority of its peers in the European indirect property Morningstar Category. For these reasons, we have upgraded the fund’s Morningstar Analyst Rating to Bronze from Neutral.


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.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
abrdn MyFolio Managed III Inst Acc95.90 GBP-0.29Rating
Fidelity China RMB Bond A-Acc-EUR14.30 EUR0.37Rating
iShares European Prpty Yld ETF EUR Dist GBP2,404.00 GBX1.30Rating
Schroder Global Recovery Z Acc GBP1.08 GBP-0.28Rating

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