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May 2008
Release Notes |
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Recap of Previous
Announcements |
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Morningstar
News |
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Release Notes
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Licensed Data Release Schedule: Data Feeds and
Morningstar� Essentials |
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Licensed Data Release Schedule |
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U.S. Open End and Variable Annuity Category Review Period |
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All Open End funds and Variable Annuity underlying funds category assignments will be reviewed starting May 20, with the appeals period concluding on May 27. Applicable category changes will be effective with May month-end data, and results will be available in all of our products in June. |
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New Categories Global Real Estate and Currency, effective July 31, 2008 |
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For July month-end we will be introducing two new Morningstar Categories, Global Real Estate and Currency. These new categories will be available for all universes with the exception of hedge funds. This change only applies to portfolios domiciled in the United States. Licensed Data test files will be available in May. |
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Global Real Estate (GR) |
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Global real estate portfolios invest primarily in non-U.S. real estate securities, but may also invest in U.S. real estate securities. These portfolios purchase debt and equity securities, convertible securities, and securities issued by Real Estate Investment Trusts (REITs) and REIT-like entities. Portfolios in this category also invest in real estate operating companies. |
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Currency (code: CR) |
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Currency portfolios invest in U.S. and foreign currencies through the use of short- term money market instruments; derivative instruments, including and not limited to, forward currency contracts, index swaps and options, and cash deposits. |
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New Broad Asset Class, effective July 31, 2008 |
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For July month-end we will be introducing a new broad asset class called "Alternative" and the primary index assigned to it is the ML USD LIBOR 3 Mon CM. This new broad asset class will contain the following five categories:
Currency
Long-Short
Bear Market
Precious Metals
Market Neutral |
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Revisions to Secondary Benchmarks for Morningstar Categories, effective July 31, 2008 |
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Effective July 31, 2008, we will make some revisions to the secondary benchmark for the following Morningstar categories:
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| Morningstar Category |
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Old Secondary Index |
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New Secondary Index |
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| Foreign Large Value, FV |
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MSCI World Ex US NR USD |
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MSCI EAFE Value NR USD |
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| Foreign Large Blend, FB |
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MSCI World Ex US NR USD |
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MSCI AC World Ex USA NR USD |
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| Foreign Large Growth, FG |
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MSCI World Ex US NR USD |
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MSCI EAFE Growth NR USD |
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| Pacific/Asia ex-Japan Stk, PJ |
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MSCI AC Far East Ex Japan USD |
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MSCI AC Far East Ex Japan NR USD |
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| High Yield Bond, HY |
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Credit Suisse HY |
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ML US HY Master II |
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| Long-Short, LO |
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Russell 3000 |
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S&P 500 TR |
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| Bear Market, BM |
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Russell 3000 |
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S&P 500 TR |
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Obsolete Category - Muni Florida, effective July 31, 2008 |
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Effective, July 31, 2008, the Muni Florida category will be closed and all Muni Florida funds in that category will be moved to one of the Muni Single State categories (Long, Intermediate or Short). Placement in either the Long, Intermediate or Short category will be based on a three-year average of duration and maturity statistics. |
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Morningstar Equity and Fund Style Box Changes, Effective Immediately |
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Morningstar recently updated its historic equity style information for all U.S. stocks and mutual funds in our database, for the time periods January 2007 through March 2008.
The stock style boxes are combined to produce the fund style boxes. It's important to note that we are not changing the Morningstar Fund Categories or the Morningstar Ratings.
We made two changes. First, we corrected some minor programming errors we made early last year when upgrading our legacy data system. Second, we made an enhancement to our style box methodology to address a growth shift in the Morningstar Value-Growth axis. The enhanced methodology no longer uses historical average market statistics when calculating Value, Core and Growth thresholds, but instead uses the current month's market statistics.
As a result of the update, the historic stock style boxes for some U.S. equities and U.S. equity funds will shift slightly leftward from Growth toward Value along the Morningstar Value-Growth axis. The resulting picture will better capture each fund's historic investment style and its movement since 2007.
If you have any questions, please contact your Morningstar representative or our product support team. |
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Morningstar Data Warehouse Feed Enhancements |
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The Morningstar Licensed Data team is excited to announce an enhanced Data Warehouse 3.3 data feed. The enhancements include numerous hedge fund data point additions, additional ETF indicators, standardized VA subaccounts returns to meet compliance requirements, super muni sector data points, statement of additional information, and additional international data points. This feed will replace the existing Data Warehouse 3.2 version for the September, Aug. 30 production and is currently available for testing.
Please contact your Relationship Manager for more information. |
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New Primary Benchmarks for Hedge Funds, effective July 31, 2008 |
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Effective July 31, 2008, we will assign a primary benchmark to each hedge fund category. This primary benchmark, based on category, will then be used to calculate more accurate MPT statistics as well as other statistics that require a defined benchmark. |
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Introducing Training Webcasts for Morningstar Directs |
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We're pleased to announce a new series of training Webcasts for Morningstar Direct 3.3 users, located in the Training Schedule under the Home tab on Morningstar Direct. These Webcast series provide introductory- to advanced-level training sessions designed to help users maximize the platform's capabilities and gain insight into Morningstar methodologies and data universes. The Webcast trainings are organized as follows:
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New user, an introduction to Morningstar Direct |
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Morningstar Direct 3.4 Enhancements, including performance reporting |
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Data Universes, including U.S. Stocks, Hedge Funds, Separate Accounts/Collective Investment Trusts, Variable Insurance, ETFs and Closed-End Funds |
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Client-focused for user roles including Portfolio and Fund of Fund Management, Marketing and Sales, Product Management and Development, Consultants and Plan Sponsors |
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Methodology, including Morningstar Rating and Style Box, Data point FAQ, Newer Morningstar Methodologies |
Please contact your Morningstar Direct team for more information. |
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Morningstar Direct 2008 Users' Forum |
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Please join Morningstar and your industry peers for a full day of learning and interaction in Boston on June 2. This event is open at no cost to all Morningstar Direct users.
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Hear from Don Phillips, Managing Director, with Morningstar's view on current industry trends. |
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Increase your productivity when using Morningstar Direct, with presentations and hands-on training from our product experts. |
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Provide your feedback on Morningstar Direct's data, features, reports, and navigation at our User Advisory Council. Start jotting down your thoughts today--we'll want to hear them all in Boston on June 2. |
Please contact Quan Domaleczny quan.domaleczny@morningstar.com or 312 696-6848 for more information. |
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Morningstar EnCorr 9.4 Release Now Available |
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Morningstar EnCorr 9.4 has been released. As always, please follow the protocol outlined by your IT department regarding downloads. The new release includes risk budgeting functionality, forecasting using log-stable returns distribution assumption, enhanced resampling, and expanded operational data among many other features and enhancements.
Please click here for a complete list of the new features in Morningstar EnCorr 9.4. |
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Collective Investment Trusts-New Information |
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As Collective Investment Trusts (CITs) continue to gain acceptance with defined contribution plans, we are also expanding our CIT database and information display in all of our applications:
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Multiple share classes: The Depository Trust & Clearing Corporation is handling an increased amount of collective fund transactions for plan participants, sponsors, and providers and Morningstar is now collecting and displaying different share classes of CITs, mainly differentiated by different fee levels. |
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CUSIPs: An increasing number of CITs, but not all, are now obtaining CUSIPs, the nine-character alphanumeric security identifiers for North American securities from the Committee on Uniform Security Identification Procedures. We've added the CUSIP identifier to our database, increasing Morningstar's ability to quickly and easily track CITs. |
The response has been positive to these enhancements. Specific inquiries on these increased capabilities or requests to add CITs to Morningstar's database can be sent to DataCITTeam@morningstar.com |
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Recap of Previous Announcements
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Morningstar Direct Enhancements |
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The Morningstar Direct team is in the final stages of preparing the Direct 3.4 release, which will include a major enhancement—performance reporting. Performance reporting gives our clients a streamlined process for creating and running daily, weekly, monthly and quarterly fund performance reports. In addition, clients will also have the option to view "obsolete" securities that were liquidated or merged in the past.
Please contact your account team for more information. |
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Business Risk Rating Replaced by Fair Value Uncertainty Rating |
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On April 1, we replaced our business risk rating with a fair value uncertainty rating in all Morningstar stock analyst reports. The new rating conveys our level of confidence to estimate a company's future cash flows. New reports on stocks we cover include an uncertainty rating of low, medium, high, very high, or extreme uncertainty.
For more information about this change, including the four key attributes we consider when deriving our new uncertainty ratings, please click here. |
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1,000 European Open-End Mutual Funds Reclassified as Hedge Funds |
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We recently reviewed all open-end funds in our European database and identified about 1,000 funds with structural characteristics of hedge funds. Over the next few months, we will be moving these funds to our hedge fund database to facilitate appropriate peer group analysis and ranking.
The 68 funds with an open-end star rating will no longer be rated in this universe. All 1,000 funds will be assigned a hedge fund category and will receive a hedge fund rating, provided the methodology requirements are met. |
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NASDAQ Stock Symbol System Changes-CANCELLED |
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Details from NASDAQ can be seen here.
Please contact your account team for additional details. |
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Investor Returns Enhancement to Accommodate Mergers |
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Effective March 31, 2008, Morningstar modified the methodology for Investor Returns in order to accommodate fund mergers. Under the previous methodology, we treated the movement of net assets from the merging fund to the surviving fund as an inflow of cash. The revised methodology addresses this issue by creating pre-merger net assets and returns that reflect the behavior of both funds.
An updated methodology document is now available on our corporate web site. |
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Morningstar News
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Morningstar Reports First-Quarter 2008 Hedge Fund Performance |
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April 17, 2008--Morningstar reported a summary of hedge fund performance for the first quarter of 2008. The Morningstar 1000 Hedge Fund Index lost 1.51% in the first quarter of 2008. The index's rebound in February of 2.43% proved insufficient to cover the losses incurred in January (-2.38%) and March (-1.50%), resulting in the worst quarterly performance in almost four years.
Press Release |
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Morningstar Issues Fifth Annual Best and Worst 529 College Savings Plan Study and Additional Resources on College Savings on Morningstar.com |
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April 16, 2008--Morningstar today announced its fifth annual study of the best and worst 529 college savings plans. Morningstar is releasing the study, along with supplementary articles about 529 plans and college savings alternatives and a video covering the basics of 529 plans, today on Morningstar.com.
Press Release |
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Morningstar Launches Morningstar Direct Alternative Investment Edition |
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April 9, 2008--Morningstar announced that it has launched Morningstar DirectSM Alternative Investment Edition, a global, multi-currency institutional research platform that provides in-depth performance analysis of approximately 8,700 hedge funds, funds of hedge funds, and Commodity Trading Advisor products.
Press Release |
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Morningstar at Industry Shows |
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| Morningstar will exhibit at the following conferences. We hope to see you there. |
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Investment Company Institute (ICI) General Management Meeting May 7-9 Washington, DC |
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Chartered Financial Analyst (CFA) 61st Annual Conference May 11-14 Vancouver, BC, Canada |
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Investment Management Consultants Association (IMCA) Spring Professional Conference May 18-20 New Orleans, LA |
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7th Annual Canada Cup of Investment Management June 5-6 Toronto, ON, Canada |
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National Investor Relations Institute (NIRI) Annual Conference June 8-11 San Diego, CA |
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Morningstar Investment Conference, June 25-27 at McCormick Place in Chicago. |
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2008 International Fund Forum June 30 - July 4 Barcelona, Spain |
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Data Questions |
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Contact your account team or our data quality department:
North America
E-mail: dataquestions@morningstar.com
Phone: +1 312-696-6600
Fax: +1 312-696-6019
Mailing address:
Data Questions
Morningstar, Inc.
225 West Wacker Drive
Chicago, Illinois 60606
USA
Europe
E-mail: dataquestions.uk@morningstar.com
Phone: +44 20 3107 0070
Fax: +44 20 3107 0001
Mailing address:
Data Question
Morningstar Europe
1 Oliver's Yard,
55-71 City Road, London EC1Y 1HQ
United Kingdom |
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�2008 Morningstar. All rights reserved. |
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This e-mail contains privileged and confidential information and is intended only for the use of the recipient. Any dissemination, distribution, or duplication of this communication without prior written consent from Morningstar is strictly prohibited. If you received this message in error please contact the sender immediately and delete the materials from any computer. You are receiving this e-mail because you are a Morningstar Data client, or because you asked that your name be added to the distribution list. If you wish to remove yourself from our institutional client communication list, please hit reply with "unsubscribe" in the subject line. If you would like to opt-in to this e-mail list please hit reply and include your full name, title, company name and address. We will be happy to add you to the list. The newsletter is free, and we never release these e-mail addresses to third parties. If you change your mind and no longer wish to receive this e-mail, we will quickly remove your name from the distribution list. |
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