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Mary KenefakeMary.Kenefake@morningstar.com
Morningstar Upgrades Analyst Rating for Seven U.S. Funds; Downgrades 10 Funds; Assigns New Ratings to 30 Funds in April

CHICAGO May 8, 2017—Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research, has published a summary of Morningstar Analyst Rating™ activity for 106 U.S. mutual funds and exchange-traded funds (ETFs) and four target-date series that occurred in April 2017. The Morningstar Analyst Rating for funds represents Morningstar’s conviction in the fund’s ability to outperform on a risk-adjusted basis over the long term. The five-tiered, qualitative Morningstar Analyst Rating scale has three positive levels, indicating Morningstar Medalists—Gold, Silver, and Bronze—in addition to Neutral and Negative ratings.

In April, Morningstar’s Manager Research Group upgraded seven U.S. funds and downgraded ratings for 10 funds. In addition, analysts affirmed ratings for 59 funds and three target-date series, assigned new ratings to 30 funds, and placed one target-date series under review.

As of April 30, 2017, Morningstar analysts had assigned a Morningstar Analyst Rating of Gold to 134 unique U.S. funds, a Silver rating to 313 funds, a Bronze rating to 509 funds, a Neutral rating to 509 funds, and a Negative rating to 13 funds. Morningstar Medalists currently account for approximately 9 percent of unique mutual funds available for sale in the United States and 61 percent of assets under management. Morningstar’s manager research analysts rate approximately $12 trillion of U.S. investor assets, or approximately 70 percent of total investor assets in the United States.

The following Morningstar Analyst Rating changes occurred in April 2017:

Fund/ Previous Morningstar Analyst Rating / Current Morningstar Analyst Rating
Upgrades

Ariel International / Neutral / Bronze
PIMCO Low Duration / Bronze / Silver
Prudential Total Return Bond / Bronze / Silver
Schwab International Index / Bronze / Silver
Schwab Total Stock Market Index / Silver/ Gold
Schwab SandP 500 Index / Silver / Gold
SPDR SandP MidCap 400 ETF / Bronze / Silver

Downgrades
BlackRock Basic Value / Bronze / Neutral
Bridgeway Blue Chip 35 Index / Silver / Bronze
CBRE Clarion Long/Short / Bronze / Neutral
Columbia Acorn International / Silver / Bronze
FPA Capital / Bronze / Neutral
Franklin Mutual Global Discovery / Silver / Bronze
Invesco Real Estate / Bronze / Neutral
Merger / Silver / Bronze
Vanguard European Stock Index / Gold / Silver
Vanguard FTSE Europe ETF / Gold / Silver

Under Review
Wells Fargo Dow Jones Target-Date Series / Neutral / Under Review

A list of the Analyst Ratings for 59 U.S. funds and three target-date series that Morningstar affirmed in April is available here. A list of the new Analyst Ratings for 30 U.S. funds that Morningstar assigned in April is available here.

A summary of last month’s Morningstar Analyst Rating changes for U.S. funds is available on Morningstar.com in the latest Fund Spy: Medalist Edition here.

Morningstar launched its Analyst Rating for funds and Global Fund Reports in November 2011. Morningstar Medalists—Gold-, Silver-, and Bronze-rated funds—are funds that analysts determine are likely to outperform their peer groups and/or relevant benchmarks on a risk-adjusted basis over a market cycle of at least five years. The differences between the positive ratings indicate the level of the analyst’s conviction in a fund’s future performance. Analysts arrive at a rating through an evaluation of five key pillars: People, Process, Parent, Performance, and Price. The Analyst Rating methodology for mutual funds is available here and for ETFs here.

To view a complete list and supporting analysis for Analyst Ratings for U.S. funds, please visit www.morningstar.com. Premium Members have access to a Morningstar Medalists screener, where users can sort funds by Morningstar Rating, Morningstar Analyst Rating, Fund Family, Manager Tenure, Expense Ratio, and other metrics. Morningstar’s Global Fund Reports, in-depth research reports that include a wealth of data and analysis, are available in Morningstar DirectSM, the company’s web-based global investment analysis platform for institutional investors, and in Morningstar OfficeSM, a global practice and portfolio management solution for advisors.

Morningstar has approximately 130 manager research analysts worldwide who cover approximately 4,270 funds. The company provides data on approximately 217,000 open-end mutual funds, 11,600 closed-end funds, and 14,100 exchange-traded product listings as of March 31, 2017.

About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individual investors, financial advisors, asset managers, retirement plan providers and sponsors, and institutional investors in the private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $200 billion in assets under advisement and management as of March 31, 2017. The company has operations in 27 countries.

Morningstar’s Manager Research Group consists of various wholly owned subsidiaries of Morningstar, Inc. including, but not limited to, Morningstar Research Services LLC. Analyst Ratings are subjective in nature and should not be used as the sole basis for investment decisions. Analyst Ratings are based on Morningstar’s Manager Research Group’s current expectations about future events and therefore involve unknown risks and uncertainties that may cause such expectations not to occur or to differ significantly from what was expected. Analyst Ratings are not guarantees nor should they be viewed as an assessment of a fund’s or the fund’s underlying securities’ creditworthiness. This press release is for informational purposes only; references to securities in this press release should not be considered an offer or solicitation to buy or sell the securities.

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©2017 Morningstar, Inc. All rights reserved.


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