ETF vehicles will soon be ranked
Morningstar Inc. will begin ranking exchange-traded-fund managed portfolios, the company said last week in Chicago at its ETF Invest Conference
Morningstar Inc. will begin ranking exchange-traded-fund managed portfolios, the company said last week in Chicago at its ETF Invest Conference.
The company, which is well-known for its star ratings system for mutual funds, also plans to create a proprietary classification system for ETF managed portfolios. That system will help financial advisers compare similarly managed portfolios.
“ETF managed portfolios are a burgeoning area,” said Andrew Gogerty, Morningstar’s ETF managed-portfolios strategist. “By expanding the research available for ETF managed portfolios, we aim to increase the awareness and transparency of this rapidly growing area of the industry.”
ETF managed portfolios are primarily separate-account strategies that have more than 50% of a portfolio’s assets in the funds.
Of the more than 330 ETF managed portfolios with about $22 billion in assets tracked by Morningstar, about 30% were launched within the past three years.
“These strategies typically offer greater flexibility than a traditional individual-security separate-account strategy, but no other firm is providing commentary, research and education for advisers in this area,” Mr. Gogerty said. “Our goal is to develop a suite of analytics and commentary that will help advisers and other investors who are sifting through these investment options.”
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