Methodology Documents

Morningstar has conducted research on active and passive investment strategies and their associated vehicles since 1986.

This paper outlines the key assumptions and details behind our quantitative equity rating methodology.

We believe that a company's intrinsic worth results from the future cash flows it can generate. The Morningstar Rating for stocks identifies stocks trading at a discount or premium to their intrinsic worth--or fair value estimate, in Morningstar terminology.

This document describes the rationale for, and the formulas and procedures used in, calculating the Morningstar Rating for funds (commonly called the “star rating”). This methodology applies to funds receiving a star rating from Morningstar.

This paper outlines the key assumptions and details behind our quantitative equity rating methodology.

Morningstar developed the Morningstar Equity Comparables system to give investors and financial professionals an objective benchmark for comparing companies. Morningstar Equity Comparables is genuinely different to other industry classification schemes. We start from the bottom up with comparable companies, as opposed to the top down with sector definitions. For every pair of companies, we determine how similar they are–anywhere from closely comparable to distantly related based on automated analysis of the companies' own business description. We automatically analyse the text of the business description and work out whether companies are talking about similar things as they describe their businesses. Businesses described in similar terms are comparable.

Methodology outlining the calculations of fee level for US Insurance fund group

China's economic growth slowdown took a break in the first quarter, as indicated by official GDP and our alternative measures. It's too early to call this a broad credit-driven rebound, since the typical one- to two-quarter lag between credit and economi

Examining the Morningstar Quantitative Rating for Funds

This methodology is applied to HK MPF Funds.

The paper outlines category definitions applicable to the Indian Insurance fund.

The Morningstar Category™ classification system for funds lets institutions, advisers and investors effectively compare like funds.

The paper outlines category definitions applicable to the Indian OE fund.

The paper defines the Morningstar Categories for the Japan-domiciled open-end funds.

The Morningstar Category™ classification system for funds lets institutions, advisers and investors effectively compare like funds.

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 betw

Although the threat of a trade war with the United States roiled China's equity markets in 2018, with about a 30% peak-to-trough decline in the Shanghai Composite, surging optimism about a deal between the countries has led Chinese equities to recover al

In 2018, we released our fund flow models into Morningstar's Investor Pulse tool starting with the U.S. market and expanding globally. Based off "The Fall of Funds" paper, we are implementing the probability of fund shutdown model so these insights can b

Morningstar methodology paper explaining the load adjusted return calculations.

Methodology document for the income and capital return calculations

Calculation methodology explaining fee level calculation for open markets in Europe, Africa and Asia

China's economy is clearly slowing, but the real extent of the slowdown is becoming more obscured due to deteriorating data quality and a shift in growth to areas of the economy such as services where data collection is less robust. Despite recent media