Morningstar Investor Review

Morningstar Investor offers in-depth investment research and portfolio management tools. Is it worth the yearly fee? Discover the pros, cons, and features.

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	Overall Score	3.8
	Price	3.0
	Mobile App	3.0
	Ease of Use	4.0
	Research	5.0

5-point scale (the higher, the better)

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Pros and Cons

• Access to leading reports and tools
• Extensive mutual funds research
• Free trial

• Expensive for smaller investors
• Limited mobile app features

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Bottom Line

Advanced investment tools for more serious investors with larger portfolios

Morningstar is best known for their popular investment ratings and research. But they have even more to offer.

With Morningstar Investor, you get in-depth investment tracking, tools, and even more research.

So how much does it cost? And is it actually worth it?

Get a detailed guide of the features, price, and competitors of Morningstar Investor in this review. Plus, learn which type of investors would get the most benefit from it.

What is Morningstar Investor?

Morningstar Investor is a paid subscription service that gives retail investors access to advanced investment tools.

Morningstar was initially founded by Joe Mansueto in 1984 and has since grown into a billion-dollar company with more than 8,000 employees.

The platform offers a ton of educational content on investing and personal finance. They also provide helpful worksheets and templates for budgeting and retirement planning.

While much of Morningstar's content is free, you'll have to pay for Morningstar Investor to access features like:

• Analyst Reports
  
• Portfolio Manager
  
• Portfolio X-Ray Tool
  
• Advanced Research + Proprietary Ratings

Read on to learn more about these features and if they make the Morningstar Investor subscription worth your while.

Who is Morningstar Investor Best for?

Costing $249 per year, Morningstar Investor is most suitable for investors with larger portfolios.

It wouldn't make sense to recommend it to someone with a $5,000 portfolio because they'd need to earn more than 4% a year just to cover this single expense, making it a poor cost/benefit decision.

That said, Morningstar's free educational content and investor tools, such as stock/fund screeners, would be helpful for any investor.

Morningstar Investor Pros and Cons

Looking for the quick takeaway? Before diving into the details of Morningstar Investor, review these quick pros and cons to know if it's right for you.

Pros

• Access to proprietary Morningstar 5-star ratings and style boxes for mutual funds
  
• In depth research reports on thousands of mutual funds and stocks
  
• Prebuilt screeners available with ability to customize
  
• Portfolio X-Ray tool lets you "see through" your portfolio's funds to see its true exposures
  
• Screener universe covers hundreds of thousands of securities

Cons

• The fixed subscription fee makes it unattractive for smaller portfolios
  
• The screener doesn't offer backtesting
  
• The mobile app has limited functionality compared to the website
  
• Many subscribers complain of bugs and software issues on their website

Morningstar Investor Features

If you sign up for a Morningstar Investor subscription ($249/year), you'll get a suite of Morningstar's proprietary portfolio management tools and more advanced research.

Here are the most useful features within Morningstar Investor:

• Full Analysis Reports: Morningstar assembles in-depth reports on thousands of stocks and mutual funds.

  These reports include business strategy and outlook, economic moat, fair value and profit drivers, risk and uncertainty, stewardship, and Morningstar's own rating.

• Portfolio X-Ray tool: This tool looks through all the pooled holdings and stocks in your portfolio to calculate your true exposures to different sectors and stocks.
  Portfolio X-Ray Tool Example: Let's say you own Apple stock and have money in a Nasdaq-tracking mutual funds, which also hold Apple. The X-Ray tool can peek into your funds and calculate your total Apple exposure across all your investments. This is especially valuable as your portfolio grows and increases in complexity.

• Best Investments: This feature gives you the top investment picks from Morningstar's 220 independent analysts.

• Screener: This more robust version of Morningstar's free basic screener comes with extra bells and whistles, including their 5-star rating system, Style Box for mutual funds, and prebuilt screens for specific strategies.

Morningstar Investor Screener

Screener is one of the best features of the paid subscription to Morningstar.

You can search and filter stocks, mutual funds, or ETFs by performance, financials and what rating they received. Or simply browse their different prebuilt screens and their descriptions.

For example, the "Cash Cows" screen identifies companies with exceptionally strong cash flow and growth.

Morningstar also lets you customize their prebuilt screens by adjusting, adding, and removing criteria. That way, you can easily find stocks that meet your criteria in real-time as you make changes.

Besides the Morningstar ratings and style box for funds, other criteria you can use include sector/industry, market cap, and valuation metrics such as P/E and dividend yield.

Once you are happy with your criteria selections, you can save the resulting stocks and move them over to the Portfolio Manager for further review and research.

You can also save any customized screens you built for future use. One downside of the Morningstar Investor Screener is that it doesn't include any historical backtesting capability.

How Much Does Morningstar Investor Cost?

Morningstar Investor's most expensive plan is the one where you pay month to month, which costs $34.95/month or about $360/year.^[1]

However, you can substantially lower this price by subscribing for a year. A one-year subscription will cost you $249/year. They also offer a free trial so there is no risk in giving it a try.

Is Morningstar Investor Worth the Money?

If your portfolio is on the smaller size (say, less than $20,000), the cost/benefit analysis is not worth it as you'd need to earn 1% a year just to cover your Morningstar fee.

If you have a larger portfolio and invest a lot in mutual funds, the Morningstar Investor subscription is likely worth it.

In that case, the $249 subscription fee becomes a smaller percentage amount of your portfolio. For example, with a $100,000 portfolio, only 0.2% of your annual return goes to Morningstar.

Morningstar does a great job of quantitatively evaluating a huge universe of mutual funds based on many criteria. They identify those that have offered the most attractive risk-adjusted returns in the past few years relative to their peers.

Their analysis looks deeper than how much a fund beat its benchmark. It looks at the return relative to how much risk the portfolio manager took and relative to how other funds with similar investment strategies performed.

Their platform makes it easy to efficiently identify the strongest funds based on historical data.

How to Contact Morningstar Customer Service

For any questions that can't be answered via their website self-help tools, you can contact Morningstar customer service by:

• Sending an email to joe@morningstar.com

• Calling 866-229-9449 between 8:00am to 5:00pm (CST) Monday through Friday

Keep in mind that some members have expressed disappointment in recurring software bugs/issues on their platform that have not been addressed despite reaching out to product support.

Morningstar Alternatives

Morningstar Investor offers a strong platform when used by the right investor, especially those that invest heavily in mutual funds. That said, it's always smart to see how they stack up to popular competitors, like the ones below.

Morningstar vs. Zacks
Zacks, popularly known for its small cap research, is like Morningstar in many ways.

Zacks also offers a free/basic membership with access to their weekly newsletter and stock picks in addition to basic portfolio research and screening tools. Just like Morningstar, Zacks also has a quantitative rating system that they apply to thousands of stocks and mutual funds.

Zack's is a bit more expensive than Morningstar, with their paid membership starting at $249/yr.^[2] This gives you access to Zack's proprietary ratings and research, in addition to more advanced screening tools.

Both platforms are similar, though the things that set Morningstar apart are their quantity of data, recognizable brand, and rating system.

Morningstar's mutual fund ratings are all relative to other funds in the same strategy, which makes for a more precise comparison when you're trying to decide between similar funds.

Morningstar vs. Motley Fool
While Morningstar is ideal for more hands-on investors who enjoy doing their own research, Motley Fool (aka "The Fool") is geared toward investors who only want specific stock buy/sell alerts.

The Fool offers several different subscription options ranging widely in price from just $149/year to more than $13,000.^[3]

A subscription to The Fool is not quite an all-in-one "portfolio management" platform like Morningstar, but more like a subscription newsletter. Depending on which package you sign up for, they will send you a weekly or monthly newsletter that includes a couple of new stock ideas.

The stocks they send you vary based on your subscription. For example, one option is called "Everlasting: 10x" package and promises to search only stocks with the most potential to return 10x over the next 5-15 years.

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Bottom Line: Is Morningstar Investor worth it?

The bottom line is that for the right investor/portfolio, Morningstar Investor can be a tool that adds value and makes managing your portfolio a more efficient and enjoyable experience.

While smaller portfolios should generally avoid paying for subscription services, the cost/benefit ratio becomes more favorable to investors managing more than $20,000.

And if you rely heavily on mutual funds in your portfolio, you might just find Morningstar's research, ratings, and screening capabilities to be invaluable to your process.

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