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Fund Spy: Morningstar Medalist Edition

Morningstar's Pillar Ratings Test Fund Companies' Priorities

Good parents often raise good children.

If you're born a Roosevelt, Kennedy, or Windsor, you arguably have a leg up when it comes to wealth and fame--even a quirky royal mystique. In the investment world, fund family lineage also can have advantages. Funds offered by Dodge & Cox, Vanguard, or Davis Advisors all are backed by a fundholder-friendly parent company that supports a proven investment process. Similarly, funds offered by firms that have not consistently served fundholders well often operate under a cloud.

Morningstar's research has shown that firms with strong stewardship practices offer funds that are more likely to survive and deliver good results for fundholders. This research also supports Morningstar's inclusion of Parent as one of the five areas that Morningstar studies to arrive at the forward-looking Morningstar Analyst Ratings for individual mutual funds.