There are only five top-tier mutual fund firms, at least in the eyes of an investment research giant.

Russel Kinnel Morningstar Director of Mutual Fund Research

Morningstar's Russ Kinnel notes that only five firms have received M*'s "high" parent rating. Those firms are: American Funds (i.e. Capital Group); DFA; Dodge & Cox; T. Rowe Price; and Vanguard. Kinnel highlights why each of those firms have that rating.

Kinnel also digs into how M*'s fund company parent ratings now work, after a recent change. Back in November, the M* team updated their methodology and changed the parent scale to five levels: low, below average, average, above average, and high. (Before the change, the scale had three levels: negative, neutral, and positive.) And the piece offers a taste of M*'s case for why parent ratings matter. 

Edited by: Neil Anderson, Managing Editor


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