Morningstar is well known for their extensive mutual fund ratings, analysis and data and now they are reaching further into the exchange traded fund (ETF) segment of the industry. Their ETF coverage offers more premium analyst reports, an ETF exclusive subscription newsletter and their in-house indexes are being used more and more for the basis of new ETFs. 

John Spence for SmartMoney reports a trio of their indices were licensed to Claymore Advisors, while Barclays offers a suite of ETFs tied to Morningstar’s stock benchmarks and First Trust Advisors offers a dividend ETF tied to a Morningstar index.  There are other style-box ETFs tracking indexes from S&P and Russell.  These ETFs tend to have more assets – over $1 billion per ETF – while Morningstar’s average about $200 million.

Morningstar offers a yearly guidebook on ETFs; the 2007 issue reports on 150 of the biggest and most popular funds (there are over 500 ETFs currently available).  The ETFs receive a star rating if there is a 3-year history.  Morningstar uses their stock analysis for ETFs, looking for ETFs that have cheap stocks, and buy and hold them for the long term.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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