Standard & Poor's Equity Research Services has upgraded its open-end mutual fund research product for financial advisors and clients.
S&P's MarketScope Advisor platform uses bottom-up research to evaluate more than 20,000 mutual funds for performance, risk and cost analysis, and ranks the funds on a scale of 1 to 5, with 5 being highest.
This new approach gives the S&P the ability to analyzed and rank new funds, without having to wait for a three-year performance history.
“The poor performance of many highly-rated funds during the recent market downturn highlights the limitations of backward-looking analysis and indicates to us that there is significant room for improvement in the way open-end mutual funds are analyzed and ranked,” said Andrea Remyn, managing director of Standard & Poor’s Equity Research Services. “We believe our new methodology provides a more dynamic and functional view of the fund marketplace, giving advisors the tools they need to make an informed decision about how a fund fits with the investment objectives of their clients.”