Morningstar has launched its Morningstar Rating (“Star Rating”) for UK managed portfolios, giving investors and financial advisers the ability to independently benchmark portfolios using Morningstar’s methodology for the first time.
The launch also introduces category averages, allowing direct peer-to-peer comparison across UK managed portfolios.
Morningstar is the only UK provider to collect underlying holdings and calculate risk-adjusted performance consistently across managed portfolios, using its independent methodology to support transparency and credibility.
Tom Mills, Principal for Multi-Asset Strategies at Morningstar, commented: “This expansion applies Morningstar’s trusted frameworks to a new suite of investments, providing advisers and investors with more decision-making tools.
“Our analysis of the latest UK MPS data reflects the investment regime of the past five to 10 years. Portfolios holding slightly more equity than category peers – particularly an extra dose of US equity – received a tailwind, while sustainable investment approaches turned into a headwind.
“While these drivers can ebb and flow, lower costs provide a structural advantage that persists. Analysis shows that costs matter – reinforcing Morningstar’s view that lower costs improve the odds of investor success, even if they’re not the only driver.”
Anastasia Georgiou, Director of Market Expansion Strategy at Morningstar, added: “We’re bringing our Star Ratings methodology and proprietary IP to UK managed portfolios at a time when the segment is growing rapidly. With robust coverage and a consistent, independent approach, we’re giving investors and advisers greater transparency and a clearer way to assess and compare portfolios. This marks an important step in building a dataset that will continue to deliver new insights to the market.”
Morningstar launched its UK Managed Managed Portfolio database in July 2022. As the first independently collected, whole-of-market resource, it now tracks nearly 1500 models.
The team will be exploring the UK Managed Portfolio Landscape in an upcoming webinar, register here.
This is the latest development from Morningstar aimed at broadening access to high-quality investment analysis and supporting better investment outcomes. It recently announced updates to its Morningstar Medalist Rating – its comprehensive forward-looking rating for managed investments.
