Morningstar Direct 3.1
Enhancements to:
•Navigation and Usability
•Functionality
•Data
Released on Friday, Feb. 2, 2007
Morningstar Direct Team
Navigation and Usability
Fund Analysis, Equity Analysis are the New Menu
Choices
As Noted in Nov. 2006 Press Release, Given the New
Focus on Collective Investment Trusts, the Databases
were Re-named
Previously called
just “Separate
Accounts”
Previously called
“Composites”
Previously called
“Commingled
Funds”
Morningstar Enhancing Coverage of Collective
Investment Trusts
CHICAGO, Nov. 29, 2006—Morningstar, Inc. (NASDAQ: MORN) today announced
plans to enhance its coverage of collective investment trusts, investment vehicles
similar to mutual funds available only in qualified retirement plans, such as 401(k)
plans.
Beginning in early 2007, Morningstar will collect net returns, in addition to gross
returns, for these pooled investment vehicles, and will provide monthly rankings and
Morningstar Ratings™ against a peer group of mutual funds. Morningstar currently
compares collective investment trusts to separately managed accounts, using gross
returns to provide a quarterly rating. Under this new framework, investors and
advisors will be able to more accurately compare collective investment trusts to
mutual fund offerings in retirement plans and will have access to timelier, more
transparent information.
“Because these investments are direct competitors with mutual funds in retirement
plans, however, we think it’s more appropriate to give them more prominence and put
them on a level playing field with mutual funds,” said John Rekenthaler, vice president
of research for Morningstar.
“Going forward, investors will be able to directly compare the star ratings of a
collective investment trust with those of a mutual fund. We hope not only to provide a
more timely, meaningful point of comparison for investors, but also to set a higher
reporting standard within the collective investment trust space.”With its recent
acquisition of the database division of InvestorForce, Morningstar now has data on
approximately 650 collective investment trusts. In addition to both gross- and net-offee performance data, Morningstar collects other data points such as risk and return
Regional Training Information Available in “Learning
Center”
Users Can Now Set Their Preferences for Summary
Statistics
With “Move To”, Users Can Now Easily Move their Rows
of Investment Vehicles in Their Investment Lists
Select rows to move, choose “Move To” under “Action”
Change Settings for Multiple Custom Calculations at
Once
Simultaneously Change Date Range for Sharpe and
Treynor Ratios, for Example, as Shown in Previous
Screen
New Functionality
Portfolio Aggregation Report – How to Generate
Portfolio Aggregation Report – The Result
Not equal-weighted, weighted as per the Aggregate weighting
More than one page of analysis,
including detailed common holdings
Peer Investor Holding Analysis, from “View Holdings”
An institutional
investor, such as
Madison Mosaic in
this case, may want
to see what its peers
– maybe its
competitors – own
in terms of stocks,
bonds, options, etc.
The comparison of
what investments
are similar or
different against a
peer or group of
peers begins here.
Peer Investor Holding Analysis from “Ownership-Portfolio”
database
You can
insert up to
15
investment
vehicles
into the
peer
analysis
Peer Security Owner Analysis from “OwnershipSecurity” Universe
You want to
find out who
owns a stock
and other
similar types of
stocks. The
analysis begins
here.
Peer Security Owner Analysis Output – see if, in this
case, Prominent Japanese Stocks are Owned by the
same Mutual Fund
Now Able to Display “Multiple” Manager Teams
And same functionality for multiple “countries available for sale,” “custodian,” “distributor,” and
other data points. The multiple data points are included in Excel downloads.
Active Share Calculation Added to Holdings Similarity
Chart
The holdings similarity chart
can be adjusted to overlap or
similarity scores as well in
“Chart Settings.”
Active Share Calculation
To calculate Active Share, just calculate the Overlap with the index of choice
and subtract from 1.
Overlap = Sum{min(w1i,w2i)}
Where
w1i = weight of stock i on portfolio 1
w2i = weight of stock i on portfolio 2
For example:
Stock
A
Port 1
0.10
Port 2
0.05
Min
0.05
B
0.03
0.20
0.03
C
0.30
0.20
0.20
D
0.25
0.10
0.10
E
0.12
0.00
0.00
F
0.20
0.35
0.20
G
0.00
0.10
0.00
Total
1.00
1.00
0.58
Overlap = 58%
Active Share = 100% - 58% = 42%
Some Background on Active Share Calculation –
Announced Last Year
•Competitive
positioning
•Screening for manager
value-add
•Fund of funds
screening for good
active managers
Find more information on “Active Shares” at:
•http://mba.yale.edu/news_events/CMS/Articles/5727.shtml
•http://www.som.yale.edu/Faculty/petajisto/active54.pdf
Hedge Fund Quicktake PDF Added
Hedge Fund Quicktake PDF – The Result
Hedge Fund Summary PDF – Contact Information Added
Insurance Product Funds - Quicktake and QT PDF
Enabled
Data Added
A complete list of new data points in Morningstar Direct 3.1 is also
available
Multiple New Data Points Added to Hedge Funds, in this
case, How the Fund is Regulated or Overseen (Altvest data
brought into Direct from InvestorForce)
Hedge Funds – New Data Points Include Entire Pull-Down of
“Hedging Techniques” – What they Hedge and How (Altvest data
brought into Direct from InvestorForce)
More Information on the Investor Type for a Collective
Investment Trust
“Traditional” data brought into Direct from InvestorForce
New Data Points Added to U.S. OE MF
Detailed Holdings Data Added to “View Holdings” and
Now Available for Many Closed End Mutual Funds and
ETFs as well
Net Returns (in addition to Gross Returns) for Separate
Accounts and Collective Investment Trusts
See when Analyst Reports have been Updated or Most
Recently Written for U.S. Stocks, OE and CE Mutual
Funds, and ETFs
By clicking on
the date, you
get the
Quicktake.
Look under
“Analysis”
Fund-of-Funds Indicator
New Closed End Fund Data points
•UNII: Undistributed Net Investment Income
•EPS
•UNII/EPS Date
Data from central Morningstar database to populate these fields this month (February 2007)