Morningstar’s New Managed Portfolios Based on Indexes

Morningstar Investment Services (MIS) launched a managed account service consisting of individually customized stock portfolios based on its own indexes and independent equity research.

According to a press release, Morningstar Managed Portfolios Select Stock Baskets are only available to registered investment advisory firms, who then work with clients to analyze their financial situation, create a risk tolerance profile, select a suitable investment strategy, monitor the portfolio performance relative to its financial goals, and review changes to the client’s financial circumstances.

The Morningstar Indexes form the basis of the stock basket’s investment composition. The basket is tailored to investor’s parameters, which include sector and industry exposure, stock restrictions, existing holdings, and personal tax situation.

MIS then selects stocks for the portfolio using Morningstar, Inc.’s data and research on the stocks within the index, giving more weight to higher-rated stocks and less weight to stocks with low Morningstar Ratings.