Does Morningstar consider management fees when rating funds?
Yes, the Star Ratings are calculated on the returns a fund earns after management fees. There is no other special consideration of fees. What about sales commissions or loads? The Morningstar Star Ratings do not include the effect of loads. The reason for this is that loads are variable (and negotiable) so there is no one “right” answer for what the value should be. Investors should consider load when choosing a fund. Note: the Canadian methodology differs from the US on this point, primarily due to the more consistent treatment of loads in the U.S. What time periods do the Star Ratings take into consideration? A fund’s overall rating stems from a weighted average of three time periods, three, five and 10 years where available. Funds less than three years old are not rated. The 10-year statistics account for 50% of the overall score, the five-year figures for 30%, and the three-year numbers for 20%. If only five years of history are available, the five-year period is weighted 60% and t
