Morningstar Review For 2024

Morningstar is an investment research and analysis firm. Joe Mansueto, a stock analyst, launched Morningstar in Chicago in 1984. The company started by publishing information about mutual funds.

Today, Morningstar is one of the world’s largest and most famous investment research companies. It has over 12,000 employees, including top industry analysts. The research team covers markets around the world, giving feedback on mutual funds, exchange-traded funds, stocks, bonds and other investments.

You can use Morningstar’s research and analyst opinions to guide your trades. Morningstar also offers analysis tools that help you make decisions about your own portfolio. Further, Morningstar manages investments for participating investors with taxable brokerage accounts and participants in workplace retirement plans.

But Morningstar is not a broker and does not, itself, execute trades. Instead, it relays customers’ trade instructions to custodians.

In the crowded world of investment analysis, Morningstar stands out as one of the best-known and well-respected providers. It’s especially useful for mutual funds and ETFs, thanks to its five-star rating system.

The Morningstar rating system ranks funds from one to five stars depending upon the company’s analysis of a fund’s past performance, fees and risks.

Regarding regular monthly cost, Morningstar’s paid service is comparable to other major sites like Bloomberg, Reuters and the Motley Fool. Morningstar also offers a yearly subscription for $249. That’s the same price as yearly access to Zacks Premium service.

Each company has a different focus, however.

For example, Bloomberg provides more ongoing daily market news and data, whereas Morningstar’s research takes more of a long-term view, and Zacks’s research focuses more on individual stocks, whereas Morningstar’s specialty is mutual funds and ETFs.

You can also access free investment research using brokers like Charles Schwab and Fidelity.

All those publications also provide free content, and Morningstar offers a free trial account as well. You can determine which research best fits your investment style by browsing the different options.

To start using Morningstar, simply go to Morningstar.com. You can then read its articles, investing ideas and research. You could also search for a specific fund or investment using its name or ticker.

Morningstar provides a decent amount of information for free. You can look up a mutual fund and find details about it such as its expense ratio, historical returns and risk level. Morningstar gives funds with at least three years of history a star rating from one to five. Funds that have outperformed similar competitors receive a four or five-star rating.

Morningstar Paid Subscription

Morningstar reserves its deepest in-depth analysis for paid subscribers. With a paid subscription, you can read the report that explains how Morningstar came up with its star rating for a fund. Morningstar also can give you an estimate of the fair value of stocks versus the market price, which can help you spot trading opportunities.

Subscribers gain access to lists of investment ideas from Morningstar, including:

• The Top Performing ETFs
• Five Star Stocks
• The Best Foreign Bond Funds
• Top Inflation-Fighters

With Morningstar’s other research and information, you can then pick the funds, stocks and bonds that suit your needs and circumstances.

Morningstar prioritizes fundamental analysis for its recommendations. It considers the financial performance of an investment relative to its market price to try to find those that are undervalued or overvalued. It’s a long-term approach, which differs from short-term strategies that focus on charting and short-term price swings.

Bloomberg, TradingView and StockCharts are research sites that offer tools for investors who prefer charting and technical analysis.

Morningstar charges $34.95 per month to access its Morningstar Investor advanced service. That service combines data and research for managing investments, checking out investment ideas and tracking the market.

You can save 41% by paying $249 for an annual subscription instead. Morningstar offers a seven-day free trial. You can create that trial period to check out premium research and recommendations. If you like those services, you can pay to continue your subscription.

Morningstar only charges the subscription. There are no other fees for using its services. The Morningstar subscription cost is similar to that of other online investment publications like Bloomberg, Reuters and the Motley Fool.

In addition, Morningstar offers several portfolio and investment analysis tools.

Portfolio Manager

Morningstar’s Portfolio Manager tool tracks your portfolio to give you a snapshot of your ongoing performance, relevant news and opinions, and insights on what you should do next. The tool helps you evaluate your strategy while identifying watchlists of future investment opportunities.

The data generated by the Portfolio Manager is useful. However, the technology looks a little dated. For example, you must manually input your portfolio holdings one by one rather than being able to link your brokerage account to track automatically. However, with a paid subscription to Morningstar Investor, you can input investment details manually or by linking outside brokerage accounts. Still, some details can only be entered manually.

X-Ray

Morningstar’s X-Ray tool analyzes your portfolio’s stocks, mutual funds and ETFs to give details you may have missed, especially those hidden in funds with lots of holdings. You can use the X-Ray tool after entering data with Portfolio Manager. The X-Ray shows information like:

• Your asset allocation
• Stock sectors to see if you’re overweighted in any one area
• Fees & expenses, including how your portfolio compares to other options
• Portfolio diversification with ideas to improve
• An analysis of your overall strategy, such as high-yield income or speculative growth to help you ensure the portfolio matches your goals

Once again, the X-Ray tool provides excellent data, but the design is dated and doesn’t automatically link to other brokerage platforms for real-time information. Access requires a paid subscription to Morningstar Investor.

Stock Screener

Morningstar has a stock screener that allows you to filter stocks by numerous data points like trailing one year return, market capitalization, dividend yield and price to earnings ratio.

Morningstar offers separate screeners for stocks, mutual funds and ETFs. It also offers specialty screeners for index funds and ESG funds. You can use a screener to identify investments that meet your criteria.

Financial Worksheets

Morningstar provides several basic free financial planning worksheets for such tasks as budgeting, goal planning, net worth calculations and personal cash flow.

Financial Advisor Support

Morningstar works with financial advisors to help design client portfolios, using the research and recommendations from the Morningstar analysts.

If you manage your portfolio, you need quality information to plan your trades. Morningstar offers that. It publishes some of the most popular reports and research for investors, especially for mutual funds and ETFs.

On the other hand, if you hire a financial advisor to design your portfolio, are only investing a small amount, or use a basic buy-and-hold strategy without much trading, you might not need the extra investment research. Especially if your broker already provides market analysis and trading tools.

If you do actively trade, your investment philosophy also matters. Morningstar is geared toward long-term fundamental analysis. Day traders may prefer a service geared more toward short-term charting and price movements.

Still, Morningstar is affordable. Its Investor service costs $34.95 a month or $249 a year. If you are an active investor looking for trade ideas, just one helpful tip from Morningstar can pay for itself many times over.