Investment research firm Morningstar Inc. says it plans to launch rankings and research on exchange-traded fund (ETF) managed portfolios later this year. Company officials made the announcement at its second annual ETF Invest Conference in Chicago on Thursday.
ETF managed portfolios are primarily separate account strategies that have more than 50% of a portfolio's assets in ETFs. Morningstar tracks more than 330 ETF managed portfolios with about $22 billion in assets. Of those, approximately 30% were launched within the past three years and the number continues to increase.
Morningstar is also creating a new, proprietary classification system for ETF managed portfolios, which advisors can use to screen offerings based on the portfolio's strategy attributes to make meaningful comparisons.
Andrew Gogerty, ETF managed portfolios strategist for Morningstar, said such strategies typically offer greater tactical flexibility than a traditional individual security separate account strategy.
By expanding the research available for ETF managed portfolios, Gogerty said Morningstar aims to "increase the awareness and transparency of this rapidly growing area of the industry."
"No other firm is providing commentary, research and education for advisors in this area," Gogerty said. "Our goal is to develop a suite of analytics and commentary that will help advisors and other investors who are sifting through these investment options."
Morningstar will rank ETF managed portfolios by performance against their peers within their classification grouping. The classifications for ETF managed portfolios differ from the Morningstar Category Classifications, which are applied to mutual funds, variable annuities and separate accounts based on the underlying securities in each portfolio.
Officials said the company will make the ETF managed portfolios rankings and research available through its advisor and institutional products, including Morningstar Advisor WorkstationSM, Morningstar OfficeSM and Morningstar DirectSM.
Selected content from the ETF managed portfolios database will also be available on Morningstar.com in early 2012.
More information about Morningstar's classification system is available at http://global.morningstar.com/ETFManagedPortfoliosClassification. And more information about its rankings and research for ETF managed portfolios is available at http://global.morningstar.com/ETFManagedPortfoliosFactSheet.