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.

Investing in the wide-moat stocks of today and tomorrow

We draw on results from a survey of U.S. adults to create a model of financial health. Using demographic, psychographic, emotional, and behavioral variables, we show that financial behavior and emotional well-being are affected by two simple mental facto

An $8.7 billion inflow is impressive for a category group that’s usually in outflow territory. Investors poured $27.6 billion into passive U.S.-equity funds last month, more than doubling the previous month’s $12.7-billion inflow. U.S. GDP growth has bee

Quality recommendations for current income and income growth from stocks.

Investing in the wide-moat stocks of today and tomorrow

Quality recommendations for current income and income growth from stocks.

Despite expectations of rising rates, taxable bond was once again the most popular category group in September with $34.9 billion in flows overall, significantly higher than the $27.5 billion it had received in August. In a reversal from the previous mon

A guide to the Morningstar classification system for Fixed Income, cash and cash equivalents. This methodology document addresses the Morningstar global fixed income classification.

Investing in the wide-moat stocks of today and tomorrow

Taxable bond remained the leading category group in August with $27.5 billion in flows overall. Unlike in June and July, however, active taxable-bond flows surpassed passive ones: $14.1 billion versus $13.3 billion.

Quality recommendations for current income and income growth from stocks.

Investing in the wide-moat stocks of today and tomorrow

Methodology explaining the fee level calculation for Australia.

Morningstar category averages are designed to represent the average return of funds within their category over time. Morningstar creates a category average daily total return index series, or TRI, as well as monthly, quarterly, and annual averages of ret

This document details the methodology for the Morningstar Total Return Index, calculated at the fund level and representing the value over time of one share purchased and owned since inception, assuming all dividends and distributions are reinvested.

The calculation logic supporting our fee level for 529 Plans.

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

Morningstar Risk Model Performance Attribution Methodology

Far from experiencing a slowdown, taxable bond and international equity saw a lot of activity in July. The two Morningstar category groups attracted $34.7 billion and $23.0 billion, respectively. For both, the majority of these flows came from passive fu

Quality recommendations for current income and income growth from stocks.

Morningstar and Sustainalytics partner to analyze the pros and cons of nuclear power as an ESG investment.

Investing in the wide-moat stocks of today and tomorrow

Quality recommendations for current income and income growth from stocks.

Taxable Bond and International Equity Continue to Dominate Flows Investors continued to stream money into taxable-bond and international-equity funds in June. Unlike in previous months, the taxable-bond Morningstar category group saw higher inflows on th

Investing in the wide-moat stocks of today and tomorrow

After five encouraging months and a so-and-so April, the U.S. equity category group slid into outflow territory in May, with total redemptions of $3.1 billion. Taxable bond remained the overall leader with inflows of $36.9 billion, and international equi

The paper contains data and product information about Morningstar New Zealand Portfolio Investment Entity (PIE) Performance Calculation Methodology

The paper contains data and product information about Morningstar Australia Total Shareholder Return Methodology for Listed Securities

The paper contains data and product information about Morningstar Australia Equity Research Methodology

The paper contains data and product information about Morningstar Australia Equity Research Coverage

The paper contains data and product information about Morningstar Manager Research Coverage in Australia & New Zealand

The paper contains data and product information about Morningstar's Australian Investments Classification Policy Methodology

The paper contains data and product information about Morningstar Australia Standard Performance Calculation Methodology

The paper contains data and product information about Morningstar Australia After-tax Performance Calculation Methodology