Introduction to Morningstar Awards

The objective of the quantitatively driven Morningstar International Fund Awards program is to recognise those funds and fund groups that have added the most value within the context of a relevant peer group for investors over the past year and over the longer term.

The program is distinct from the qualitative awards issued by Morningstar’s research team. The awards are annual, so we believe it is appropriate to emphasise a fund’s one year performance. However, we do not wish to be in the position of giving awards to funds that have posted a strong one year return, but have otherwise not delivered good results for investors. We also recognise that investors often use awards as a “buy” signal, and we do not wish to steer them to offerings that may not be good longer term investments.

The awards methodology therefore emphasises the one year period, but funds must also have delivered strong three and five year returns after adjusting for risk within the awards peer groups in order to obtain an award. Further, they must have been at least in the top half of their respective peer groups in at least three of the past five calendar years. We believe this combination will ensure that the awards are given to funds which have earned strong one year results, and have also shown they have the ability to earn strong long term returns without undue risk.