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  • Writer's pictureSam Fiduciary

What are 3-Year Morningstar Rankings and Why are They Important?


What are 3-Year Morningstar Rankings and Why are They Important to Consider for Your Employee Retirement Plan?
What are 3-Year Morningstar Rankings and Why are They Important to Consider for Your Employee Retirement Plan?


What are 3-Year Morningstar Rankings and Why are They Important to Consider for Your Employee Retirement Plan?


As a fiduciary on your company’s employee retirement plan, you must ensure that the plan portfolio is diversified and that you do not allocate into underperforming mutual funds, hindering the plan returns and subjecting participants to unnecessary risk.


Luckily, there is an easy tool for evaluating different mutual funds to ensure that you select the best mutual fund allocations for your plan, thus maximizing returns and mitigating risk for plan participants. This tool is known as a Morningstar ranking.


Morningstar rankings measure the risk-adjusted return of a given mutual fund. These reports streamline researching mutual funds by considering various factors and compiling them into one easy-to-understand rating. Typically Morningstar ratings evaluate expenses, fund sizes, and fiduciary ratings. Typical ratings range from one to five stars. The best-performing funds receive a five-star ranking, while the worst performers receive a one-star rating. That way, you can evaluate the track record of available mutual funds and pick the best allocations for your plan while avoiding underperforming funds.


If you are a fiduciary for your company’s employee retirement plan and are concerned about the performance or need assistance evaluating morningstar rankings to choose the best investment allocations for your fund, I can help. My specialty is reviewing and adding 99% value to existing employee retirement plans. I can help you make sense of the Morningstar rankings for the funds you are evaluating and help you choose investment allocations that will secure the maximum return for your plan and protect the plan participants from unnecessary risk. Contact me today if you’re ready to get the most value from your company’s retirement plan and make sense of Morningstar rankings.

 

If you are a fiduciary for your company’s employee retirement plan and are concerned about your current investment options, I can help. My specialty is reviewing and adding 99% value to employee retirement plans. Contact me today if you’re ready to get the most value from your company’s retirement plan and protect yourself from personal liability as a fiduciary.


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