Morningstar Direct is intended to be the gateway to all information that Morningstar holds in its proprietary databases, a goal that we are working towards achieving for the benefit of our institutional user base and their diverse investment needs.
Morningstar Direct has moved further towards being a gateway by providing as much information as possible on practically all investment vehicles it currently has available.
The concept of readiness flags was introduced into the databases appearing in Morningstar Direct to help provide users with comprehensive transparency.
It is recommended that all Morningstar Direct subscribers take "readiness" into consideration for all of their investment vehicle screening and evaluation purposes.
There are four readiness indicators or flags to facilitate identifying investment vehicles that are ready from those that are not ready:
• Operations
• Performance
• Portfolio
• Price
Except for performance data points, any information that is available on an investment vehicle appears in Morningstar Direct, even when all of the items in the operations, price, and portfolio data sets defined below are not deemed "ready."
Where Do Readiness Flags Appear?
The four readiness flags are included in the dropdown box when you initiate a search and appear as data points in the Snapshot view for most of the databases in Morningstar Direct:
• Category Averages
• Closed End Funds
• ETFs
• Indexes
• Insurance Product Funds
• Money Market Funds
• Open End Funds
• Separate Accounts and Collective Investment Trusts
• U.K. Pension Funds
• Variable Annuity and Variable Life Subaccounts
Readiness flags do not appear in the Hedge Fund database as most of the criteria for "readiness" - or not - do not apply. Readiness flags also do not apply to the Ownership databases (portfolio and security) or the Stocks database.
Primarily depending on the completeness of the data points outlined below, the four "Readiness" columns in Morningstar Direct either read either "Yes" or "No." Keep in mind that this is a general overview, with specifics being applied to the different investment vehicles we cover and regions in which we operate globally.
The readiness status of all investment vehicles is updated daily.
"Operations readiness" for the US universe depends on Morningstar's having the following 14 data points for an investment vehicle:
• ISIN: International Securities Identification Number. This is a worldwide standard 12 character code for securities. If ISIN is not applicable to the investment vehicle, a relevant other code will be used (such as CUSIP, MEX Id, WKN, SEDOL, Oslobors, PMI, PPM, etc.).
• Investment Vehicle Name: current legal name of the investment vehicle
• Share Class Name: for publicly traded investment vehicles, the name of the share class, displayed as an extension of the investment vehicle name
• Base Currency: currency the investment vehicle is registered to use
• Class Date of Inception: for publicly traded investment vehicles, the first trading date of the share class
• Company Name: generic name that represents the group of investment vehicles
• Domicile: country where an investment vehicle is legally registered
• Legal Status: type of investment vehicle
• Countries where Registered for Sale: countries where the investment vehicle is legally registered for marketing purposes
• Country where Available for Sale: to an institutional or retail investor, or both
• Investment Objective: summary of the investment objectives and policy provided by the money management firm, usually retrieved from a prospectus
• Max Management Fee: maximum percentage deducted from an investment vehicle's average assets to pay for its operations
• Max Front-end Load: maximum initial buying charge
• Max Back-end Load: maximum back-end load/contingent deferred sales charge structure
• Morningstar Category: identifies investment vehicles based on their objective as well as actual investment styles as measured by their underlying portfolio holdings (portfolio and other statistics over the past three years)
An investment vehicle is deemed "Performance Ready" when Morningstar has complete price and dividend data (such as inception date, previous day, daily, and month-end Net Asset Value Per Share (NAVPS), Accumulated Unit Value (AUV), and Unit Value (UV)) and we can calculate a total cumulative return.
If Morningstar does not have all performance back to inception (if the investment vehicle is very old), an accurate total cumulative return is still calculated if we have collected price and dividend information as far back as the first available price.
Only in the case of performance data readiness will all performance datapoints not be displayed in Morningstar Direct if the any of the one or more items in the performance data set (inception date, AUV, etc.) is incorrect or missing.
An investment vehicle is declared "Price Ready" when Morningstar has the ability for the investment to be updated with ongoing pricing information, by several methods, be it files directly from the money manager, NASDAQ end-of-day feeds, and other sources and means. We may or may not have full price history for an investment vehicle, but expect to receive ongoing prices from the data provider.
Given Morningstar's focus on holdings in order to analyze investment vehicles, an investment vehicle is declared "Portfolio Ready" when it has provided a portfolio of its holdings to Morningstar.
If a portfolio is not refreshed for an investment vehicle after 18 months, Morningstar Direct will no longer display the portfolio information, except in the Ownership-Portfolio database. In such cases, the investment's "Portfolio Ready" indicator will remain set to yes.
See Also
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