Funds Research Help

Morningstar rates mutual funds from one to five stars based on how well they've performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. Within each Morningstar Category, the top 10 percent of funds receive five stars, the next 22.5 percent four stars, the middle 35 percent three stars, the next 22.5 percent two stars, and the bottom 10 percent receive one star. Funds are rated for up to three time periods -- three-, five-, and 10 years -- and these ratings are combined to produce an overall rating. Funds with less than three years of history are not rated. Ratings are objective, based entirely on a mathematical evaluation of past performance. They're a useful tool for identifying funds worthy of further research, but shouldn't be considered buy or sell recommendations.

The Morningstar Style BoxT was introduced in 1992 to help investors and advisors determine the investment style of a fund. The equity Style Box is a nine-square grid that classifies securities by size along the vertical axis and by value and growth characteristics along the horizontal axis. Different investment styles often have different levels of risk and lead to differences in returns. Therefore, it is crucial that investors understand style and have a tool to measure their style exposure. For the Fixed-Income Morningstar Style Box, see Fixed-Income Style Box.