The research firm’s “analyst rating” is forward-looking.
On an annual basis, analysts review and if necessary re-rate the funds on a five-tier scale with three positive ratings of Gold, Silver, and Bronze, a Neutral rating, and a Negative rating.
The analyst rating differs from the firm’s backward-looking “star rating”, which assigns 1 to 5 stars based on a fund’s past risk- and load-adjusted returns versus category peers.
Analyst Rating changes — November 2015
| Fund | Analyst rating | Previous rating | Analysis date |
| BGF New Energy A2 | Neutral | Under Review | Nov 25 |
| BGF World Energy A2 | Bronze | Under Review | Nov 25 |
| JPMorgan ASEAN (acc) – USD | Bronze | Neutral | Nov 5 |
| Templeton Emerging Mkts Bd A QDis $ | Bronze | Silver | Nov 25 |
The rating is based on the analyst’s conviction in the fund’s ability to outperform its peer group and/or relevant benchmark on a risk-adjusted basis over the long term. If a fund receives a positive rating of Gold, Silver, or Bronze, it means Morningstar analysts think highly of the fund and expect it to outperform over a full market cycle of at least five years.
1. BGF New Energy A2
Morningstar has moved the fund to Neutral. The fund’s rating was placed Under Review (previously Bronze) following the announcement that co-manager Robin Batchelor is to retire and leave the firm by the end of 2015. Alastair Bishop, who joined the BlackRock resources team in 2010 as an energy analyst, was appointed to the role of co-manager alongside current co-manager Poppy Allonby. While we acknowledge the continuity and experience provided by Allonby and have been encouraged by Bishop’s input over the years, we believe Batchelor’s departure will be a loss to the team. In addition, our conviction in the team’s ability to execute this particularly strategy has waned.
— Fatima Khizou, Manager Research Analyst
2. BGF World Energy A2
The fund has been moved to Bronze. The fund’s rating was placed Under Review (previously Silver) following the announcement that co-manager Robin Batchelor is to retire and leave the firm by the end of 2015. Alastair Bishop, who joined the BlackRock’s resources team in 2010 as an energy analyst, was appointed to the role of co-manager alongside current co-manager Poppy Allonby. While we acknowledge the continuity and experience provided by Allonby and have been encouraged by Bishop’s input over the years, we believe Batchelor’s departure will be a loss to the team given his expertise, particularly in the current environment. This impending change in the management team has lessened our highly positive view of the fund.
— Fatima Khizou, Manager Research Analyst
3. JPMorgan ASEAN (acc) – USD
The fund has been upgraded to Bronze. Previously it held a Neutral rating. Our upgrade was based on two main factors: impressive insights from the portfolio manager and increased belief in the stability of the investment team backing her. Pauline Ng has been involved with the strategy for over a decade, and this comes across in her analysis of the markets and stock insights. The supporting investment team had seen some turnover but has been stable since 2012. Ng has managed to deliver relative returns above both the index and Morningstar Category average over her tenure. The fund’s low fee is a positive here as well.
— Mark Laidlaw, Senior Manager Research Analyst
4. Templeton Emerging Mkts Bd A QDis $
The fund has been moved down to Bronze. It previously held a rating of Silver. We remain confident in the lead manager Michael Hasenstab as well as his experienced co-management team, and we continue to view his long-term, fundamentals-driven investment process positively. However, the manager’s recent handling of the fund’s exposure to Ukrainian debt, including since the debt agreement in August 2015, has underscored the high level of idiosyncratic risk the strategy can entail. In light of how these risks are managed, as well as the strategy’s above-average fees, the Bronze rating is a fairer reflection of our degree of conviction at this stage.
— Shannon Kirwin, Fund Analyst
