In
the
past,
Morningstar
used
several
different
ratings
systems.
There
was
the
Morningstar
Analyst
Rating.
There
was
the
Morningstar
Quantitative
Rating.
Today,
both
are
combined.
The
result
is
a
single
forward-looking
rating
called
the
Morningstar
Medalist
Rating.
This
change
happened
in
2023,
and
was
the
result
of
a
significant
simplification
of
strategy
search,
investment
selection,
and
our
monitoring
of
the
wider
investment
universe.
Overall,
it
brings
our
best
thinking
on
a
huge
range
of
data
points
into
one
house
view.
How
Our
Ratings
Have
Changed
Over
Time
Morningstar
has
been
doing
research
on
active
and
passive
funds
since
1986.
From
November
2011,
this
research
was
expressed
globally
through
the
Morningstar
Analyst
Rating
For
Funds.
At
the
time,
this
was
a
rating
given
to
funds
by
Morningstar’s
manager
research
analysts,
based
on
qualitative
analysis.
Then,
in
2017,
Morningstar
expanded
its
manager
research.
This
led
to
the
launch
of
a
Quantitative
Rating
for
Funds,
which
used
algorithmic
techniques
and
inheritance
logic
to
assign
ratings
to
strategies
and
vehicles
that
Morningstar’s
manager
research
analysts
didn’t
personally
cover.
This
Morningstar
Quantitative
Rating
was
designed
specifically
to
mimic
analyst
decision-making
as
much
as
possible
via
a
quantitative
approach.
Today,
the
Morningstar
Medalist
Rating
is
the
full
and
final
expression
of
Morningstar’s
forward-looking
view
on
all
rated
strategies –
the
result
of
both
approaches
in
one.
Why
Did
Morningstar
Change
to
a
Medalist
Rating?
The
Morningstar
Medalist
Rating
provides
investors
with
a
more
simplified
and
expansive
rating
system.
But
the
real
reason
we’ve
done
this
is
because
we
know
investors
are
faced
with
more
choice
than
ever
before.
Over
the
past
20
years,
the
number
of
managed
investment
products
has
grown
steadily
at
around
11%
per
year.
On
average,
during
the
past
two
decades,
approximately
3,000
new
share
classes
were
opened
each
month.
At
the
end
of
2022,
Morningstar’s
databases
contained
over
750,000
live
investment
vehicles
globally.
Morningstar
has
one
of
the
largest
manager
research
staffs
in
the
world,
with
over
150
analysts
conducting
qualitative
due
diligence.
However,
even
a
staff
this
large
cannot
keep
pace
with
the
growth
of
the
managed
investment
universe.
But
it’s
not
about
us.
It’s
about
you.
The
reality
is
that
having
two
segregated
forward-looking
rating
systems
in
our
software
and
reports
has
not
been
the
easiest
thing
for
our
clients,
customers,
and
readers
to
navigate.
Before,
if
an
investor
wanted
to
“screen”
for
Morningstar’s
best
ideas,
for
example,
they
had
to
juggle
multiple
signals
and
methodologies.
With
the
Morningstar
Medalist
Rating,
this
is
much
easier
to
do.
Does
This
Change
Morningstar’s
Ratings
Methodology?
The
Morningstar
Medalist
Rating
doesn’t
change
our
underlying
methodology.
As
a
result,
we
do
not
expect
any
upgrades
or
downgrades
for
either
Analyst
Ratings
or
Quantitative
Ratings.
The
primary
change
relates
to
the
way
ratings
are
actually
displayed
on
our
platforms.
Specifically,
the
data
point
names
will
change
from
“Morningstar
Analyst
Rating”
and
“Morningstar
Quantitative
Rating”
to
“Morningstar
Medalist
Rating.”
Additionally,
we’ve
removed
the
superscript
“Q”
from
the
overall
rating
levels –
Gold,
Silver,
Bronze,
Neutral,
and
Negative –
for
all
strategies
currently
rated
by
the
Morningstar
Quantitative
Rating.
Only
where
an
algorithmic
technique
was
used
to
assign
a
pillar
ratings
is
it
retained.
In
such
cases,
authorship
is
attributed
with
the
words
“Autogenerated
by
Morningstar
Manager
Research.”
Morningstar
Medalist
Ratings:
Final
Things
to
Note
Finally,
we’ve
introduced
two
new
data
points
to
provide
additional
transparency
on
how
ratings
are
derived.
The
first
data
point,
called
“Analyst
Assigned
%”
denotes
the
extent
that
analysts
were
involved
in
the
assignment
of
individual
pillar
ratings.
The
second
data
point,
called
“Data
Availability
%”
denotes
the
extent
to
which
underlying
data
inputs
were
available
for
the
algorithmic
approach
to
pillar
ratings
at
the
time
of
the
rating
assignment.
Both
data
points
will
be
available
for
all
rated
vehicles.
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