Morningstar Magazine - October/November 2016 - 38

Spotlight: is e ec ivel n a ne e ample o is e or ornings ar s an i a ive researc eam as designed e lo al is odel ic ses ac ors o decompose e so rces o re rn and ris or a s oc or an e i por olio an o ese ac ors are ased on ornings ar s proprie ar ra ings s c as an i a ive air al e Es ima e and ornings ar an i a ive Economic oa e model also incl des s le sec or region and c rrenc c arac eris ics e idea is o provide inves ors i a po er l lens i ic o nders and e po en ial ris s o a s oc or por olio ile e model is oc sed ini iall on e i ies i ill e e panded o incl de o er asse classes Understanding the Model is is in eren o inves ing Developing a prospec ive vie o ris allo s inves ors o ma e inves men decisions ailored o eir individ al ris pre erences and l ima el increase e ili derived rom eir inves men por olio A ris model orecas s e dis ri ion o re asse re rns is dis ri ion con ains all e in orma ion needed o assess e ris iness o a por olio As e orecas dis ri ion idens a indica es more ncer ain a o e re re rn po en ial o e por olio As ail pro a ili ies increase a indica es e por olio as ig er ris o e periencing an e reme loss i is orecas inves ors are empo ered o eval a e e ris iness o asse s or por olios o asse s n essence e model see s o iden i a small n m er o independen la en so rces o re rn ovemen s in ese so rces drive e movemen in a compara l small n m er o in erpre a le ac ors An e ample o a ac or is e e pos re o par ic lar c rrencies or e ample o m c does an increase in e e ro S dollar e c ange ra e drive an increase in e val e o a s oc ovemen s in e ac ors drive asse re rns everal me odological c oices m s e made en ilding a ris model r c oices ere made i e goal o crea ing a ni e in erpre a le responsive and predic ive model e egan i e ollo ing ass mp ions a o asse re rns a s aped o r me odological c oices 38 ornings ar c o er ovem er 2016 ere are a small n m er o independen so rces o mar e movemen a drive e ma ori o varia ion in asse re rns 3 Asse re rns are no normall dis ri ed 3 e dis ri ion o asse re rns c anges ro g ime 3 ese ree concep s are ell-recogni ed and noncon roversial al o g some or all o em are o en ignored or convenience ris -modeling prac i ioners Under the Hood everal ea res ma e e ornings ar lo al is odel ni e 3 e se proprie ar ndamen al- ased ac ors a e elieve are s perior drivers o re rns ornings ar s researc gro p provides or ardloo ing ra ings on asse s ic ave een s ccess l in predic ing e re dis ri ion o re rns ac ors ased on ese ra ings also end o e ncorrela ed i radi ional ris ac ors ma ing em a complemen ar addi ion o o r ris ac or model i e ise e ave dis illed ornings ar s proprie ar da a ase o m al nd oldings in o ac ors a are also ncorrela ed predic ors o e re dis ri ion o re rns a Drives Por olio is s and e rns T. Rowe Price Overseas Stock Style e ran o old-ra ed m al nds o e Price verseas oc and ppen eimer n erna ional ro A ro g o r lo al is odel a process is ill s ra ed o e rig sing ornings ar s is igna re ac or e pos res are s o n in ars ic are gro ped ac or pe and sor ed e pos re si e o nds ave a oveaverage ac or e pos res o s oc s i economic moa s and s rd alance s ee s and elo -average e pos re o compan si e e o nds di er on e pos res o emerging mar e s in E rope and Asia and sec ors s c as ind s rials and financial services Uncertainty 0.49 Fair Value Economic Moat 0.41 Financial Health 0.11 -0.04 Liquidity -0.10 Value-Growth -0.14 Ownership Popularity -0.25 Momentum -0.32 Volatility -0.39 Ownership Risk Size -0.73 -1.48 Oppenheimer International Growth 0.59 Economic Moat 0.43 Financial Health Value-Growth 0.24 Momentum -0.03 Ownership Popularity -0.03 Fair Value -0.05 -0.18 Liquidity -0.48 Uncertainty -0.57 Volatility Ownership Risk -0.83 Size o rce -1.22 ornings ar

Table of Contents for the Digital Edition of Morningstar Magazine - October/November 2016

Contents
Morningstar Magazine - October/November 2016 - Cover1
Morningstar Magazine - October/November 2016 - Cover2
Morningstar Magazine - October/November 2016 - 1
Morningstar Magazine - October/November 2016 - 2
Morningstar Magazine - October/November 2016 - Contents
Morningstar Magazine - October/November 2016 - 4
Morningstar Magazine - October/November 2016 - 5
Morningstar Magazine - October/November 2016 - 6
Morningstar Magazine - October/November 2016 - 7
Morningstar Magazine - October/November 2016 - 8
Morningstar Magazine - October/November 2016 - 9
Morningstar Magazine - October/November 2016 - 10
Morningstar Magazine - October/November 2016 - 11
Morningstar Magazine - October/November 2016 - 12
Morningstar Magazine - October/November 2016 - 13
Morningstar Magazine - October/November 2016 - 14
Morningstar Magazine - October/November 2016 - 15
Morningstar Magazine - October/November 2016 - 16
Morningstar Magazine - October/November 2016 - 17
Morningstar Magazine - October/November 2016 - 18
Morningstar Magazine - October/November 2016 - 19
Morningstar Magazine - October/November 2016 - 20
Morningstar Magazine - October/November 2016 - 21
Morningstar Magazine - October/November 2016 - 22
Morningstar Magazine - October/November 2016 - 23
Morningstar Magazine - October/November 2016 - 24
Morningstar Magazine - October/November 2016 - 25
Morningstar Magazine - October/November 2016 - 26
Morningstar Magazine - October/November 2016 - 27
Morningstar Magazine - October/November 2016 - 28
Morningstar Magazine - October/November 2016 - 29
Morningstar Magazine - October/November 2016 - 30
Morningstar Magazine - October/November 2016 - 31
Morningstar Magazine - October/November 2016 - 32
Morningstar Magazine - October/November 2016 - 33
Morningstar Magazine - October/November 2016 - 34
Morningstar Magazine - October/November 2016 - 35
Morningstar Magazine - October/November 2016 - 36
Morningstar Magazine - October/November 2016 - 37
Morningstar Magazine - October/November 2016 - 38
Morningstar Magazine - October/November 2016 - 39
Morningstar Magazine - October/November 2016 - 40
Morningstar Magazine - October/November 2016 - 41
Morningstar Magazine - October/November 2016 - 42
Morningstar Magazine - October/November 2016 - 43
Morningstar Magazine - October/November 2016 - 44
Morningstar Magazine - October/November 2016 - 45
Morningstar Magazine - October/November 2016 - 46
Morningstar Magazine - October/November 2016 - 47
Morningstar Magazine - October/November 2016 - 48
Morningstar Magazine - October/November 2016 - 49
Morningstar Magazine - October/November 2016 - 50
Morningstar Magazine - October/November 2016 - 51
Morningstar Magazine - October/November 2016 - 52
Morningstar Magazine - October/November 2016 - 53
Morningstar Magazine - October/November 2016 - 54
Morningstar Magazine - October/November 2016 - 55
Morningstar Magazine - October/November 2016 - 56
Morningstar Magazine - October/November 2016 - 57
Morningstar Magazine - October/November 2016 - 58
Morningstar Magazine - October/November 2016 - 59
Morningstar Magazine - October/November 2016 - 60
Morningstar Magazine - October/November 2016 - 61
Morningstar Magazine - October/November 2016 - 62
Morningstar Magazine - October/November 2016 - 63
Morningstar Magazine - October/November 2016 - 64
Morningstar Magazine - October/November 2016 - 65
Morningstar Magazine - October/November 2016 - 66
Morningstar Magazine - October/November 2016 - 67
Morningstar Magazine - October/November 2016 - 68
Morningstar Magazine - October/November 2016 - 69
Morningstar Magazine - October/November 2016 - 70
Morningstar Magazine - October/November 2016 - 71
Morningstar Magazine - October/November 2016 - 72
Morningstar Magazine - October/November 2016 - 73
Morningstar Magazine - October/November 2016 - 74
Morningstar Magazine - October/November 2016 - 75
Morningstar Magazine - October/November 2016 - 76
Morningstar Magazine - October/November 2016 - 77
Morningstar Magazine - October/November 2016 - 78
Morningstar Magazine - October/November 2016 - 79
Morningstar Magazine - October/November 2016 - 80
Morningstar Magazine - October/November 2016 - 81
Morningstar Magazine - October/November 2016 - 82
Morningstar Magazine - October/November 2016 - 83
Morningstar Magazine - October/November 2016 - 84
Morningstar Magazine - October/November 2016 - 85
Morningstar Magazine - October/November 2016 - 86
Morningstar Magazine - October/November 2016 - 87
Morningstar Magazine - October/November 2016 - 88
Morningstar Magazine - October/November 2016 - 89
Morningstar Magazine - October/November 2016 - 90
Morningstar Magazine - October/November 2016 - 91
Morningstar Magazine - October/November 2016 - 92
Morningstar Magazine - October/November 2016 - 93
Morningstar Magazine - October/November 2016 - 94
Morningstar Magazine - October/November 2016 - 95
Morningstar Magazine - October/November 2016 - 96
Morningstar Magazine - October/November 2016 - Cover3
Morningstar Magazine - October/November 2016 - Cover4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2024q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019winter
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019fall
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019summer
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019spring
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20191201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20181011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20181201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20171011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20171201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20161011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20161201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20151011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20151201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20141011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20141201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20131011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20131201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20121011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120405
https://www.nxtbook.com/nxtbooks/morningstar/investorconference2012
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20121201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20111011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20111201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20101011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100809_lincoln
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100607_lincoln
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100405_lincoln
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20101201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20091011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008fall
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008summer
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2007spring
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2007fall
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2007summer
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008spring
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008catalog
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008winter
https://www.nxtbookmedia.com