Morningstar ETFInvestor

A global approach to investing in discounted markets with improving fundamentals

Morningstar ETFInvestor scans the globe for value and improving fundamentals across virtually all asset classes. Editor Samuel Lee draws upon academic and practitioner research--including Morningstar's sizeable bench of stock, bond and fund analysts—to find reliable drivers of outperformance.

What You'll Get Performance About the Editor

Monthly Issues
Every issue contains Samuel Lee's analysis of ETFInvestor's two model portfolios, commentary and research on the investment issues of the day, and performance updates on our ETF coverage universe. He'll also draw on Morningstar's deep analyst bench to provide detailed analysis of individual exchange-traded funds and market segments.

Our Strategy in Action

ETFInvestor takes a long view, casting our analysis back many decades and over many different countries, and seeks to understand drivers of excess returns that have existed in those varied environments. One of the universal results is that high-yielding assets outperform over the long haul, but not at all times and all environments.

Sam applies this strategy in two real-money model portfolios.

The ETF Income Portfolio rejects the tyranny of benchmarks, which often encourage bad behavior, and instead focuses on building positive after-inflation returns through high-yielding asset classes. While income is expected to be high over a full market cycle, there will be times when markets offer too little yield for their prospective risks.

The ETF Global Asset Allocation Portfolio is for more benchmark-conscious investors, and is more tactical and aggressive, but will also possess an income bias over most of the business cycle. Both strategies diversify across all the major asset classes. Sam has the majority of his personal portfolio in both strategies.

Six Quantitative Model Portfolios
We have developed quantitative strategies based on academic research. They capitalize on value and momentum signals to generate trades monthly. The strategies range from all-in-one portfolios to satellite offerings, and are not meant to replace our actively managed portfolios. Rather, they are used to generate trade ideas and signals.

ETFInvestor Online
Keep informed of breaking news and between issue commentary via our ETFInvestor companion website. You can track performance of the Income and Asset Allocation strategies, access analyst reports on ETFs, screen the entire ETF universe, and download the last 12 issues of the publication.

E-mail Alerts
Whenever Sam makes a change to the portfolios you will receive an e-mail alert with complete transaction details. Sam will also e-mail you with his opinions about events and/or changes related to the companies on his watch list, as well as his thoughts on the market.

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What You'll Get Performance About the Editor

What is the ETF Income Strategy?
The strategy targets a return of 5% in excess of the 30-day T-bill rate over a full business cycle, with the least risk possible. It favors high-yield opportunities with improving fundamentals. In addition, it will attempt to hedge against inflation, disinflation, recession and growth, a "risk-parity" approach. Tracking error to conventional benchmarks will be significant.

Who should invest in the ETF Income Portfolio?
The portfolio is suitable for income-seeking investors who are comfortable deviating from the market’s returns for long periods. It will not seek the highest yields possible at all times; at times it will shift to lower-yielding investments, or even cash, if valuations do not offer enough reward for the risk borne. It will be a relatively low turnover strategy.

What is the ETF Global Asset Allocation Strategy?
The strategy seeks to beat the 60/40 MSCI ACWI/Barclays US Aggregate benchmark over a full business cycle, with the least risk possible. Using analyst discretion, it will deviate from its benchmark allocations in order to capitalize on the best valuations and improving fundamentals. Tracking error will be moderate.

Who should invest in the ETF Global Asset Allocation Portfolio?
The portfolio is suitable for moderate-risk-seeking investors looking to maximize return and who are comfortable deviating from the market’s returns for long periods. It will be more aggressive and have higher turnover than the Income Portfolio, and use both fundamental and technical signals.

What You'll Get Performance About the Editor

Samuel Lee, Editor, Morningstar ETFInvestor

Samuel Lee is an ETF strategist for Morningstar and editor of Morningstar ETFInvestor, a monthly investment newsletter. Prior to becoming editor, Lee was a fund analyst on Morningstar's passive funds research team, where he covered alternative, dividend, and actively managed ETFs and performed quantitative modeling of ETF strategies.

Lee joined Morningstar in 2008 as a data analyst, where he evaluated ways to measure and improve the firm's data quality.

Lee holds a bachelor's degree in economics, with honors, from Grinnell College.