Why Some Categories Have No Gold-Rated Funds

High conviction in the managers, low fees and the ability of producing alpha are the main requirements to receive a Gold rating by Morningstar analysts.

Annalisa Esposito 23 September, 2020 | 9:07AM
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Gold Funds

Have you been scouting for Morningstar Gold-Rated funds in a specific category and have not managed to find any? Fund ratings can be a helpful tool in whittling down the enormous universe of available funds to choose from and deciding which ones to add to your portfolio. But if Morningstar analysts don’t see any funds in a category as worthy of a Gold rating in a category, then there won't be any.

“If you can't find a Gold-Rated fund in a particular category, it simply means we don’t think there is someone strong enough to earn a gold rating,” says Christopher Traulsen, director of fund research at Morningstar. There are myriad reasons that funds might not cut the mustard: lack of talented managers in the category, high fees or a poor record in beating the benchmark, to name just a few.

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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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About Author

Annalisa Esposito  is a data journalist for Morningstar.co.uk