Changes to Morningstar Ratings: The Impact

Fund downgrades will outnumber upgrades two-to-one under revamped Morningstar Analyst Rating methodology which comes into effect November 1, 2019

Mathieu Caquineau, CFA 28 October, 2019 | 9:16AM

Around a third of Morningstar Analyst Rated funds and ETFs are set to see a change to their rating under a revamped ratings system. Research by Morningstar analysts suggests the number of funds across downgraded will outnumber those being upgraded by a two-to-one margin.

Yet while the percentage of active funds rated Gold, Silver or Bronze is set to fall, the proportion of index funds earning an Analyst medal rating is likely to increase. Initial analysis suggests that up to 52% of Bronze Rated funds will see a change to their analyst rating, 30% of Silver Rated funds, and 13% of funds rated Neutral.

exhibit 1

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About Author

Mathieu Caquineau, CFA

Mathieu Caquineau, CFA  Senior Fund Analyst, Morningstar France

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