Indicates a particular fund’s investment goals, based on the wording in a fund's prospectus. The following prospectus objectives are listed in this program:
Diversified Emerging-Markets Stock
Government Bond-Adjustable-Rate Mortgage
Benefits
By looking at the objective, investors can get a general idea of a fund’s overall investment approach and goals. It’s important to note that a fund may categorize itself in a particular prospectus objective, yet in practice may more accurately fit into a different grouping.
Origin
Morningstar bases a fund’s objective on the wording in the prospectus sent by the mutual fund’s distributor or underwriter. The manner in which the fund is marketed may also influence the categorization, but to a lesser degree. In general, Morningstar won’t second-guess a fund’s prospective-objective categorization. If a fund calls itself small company, that’s how we’ll categorize it.
For the Pros
Understanding a fund’s objective can be helpful in matching a fund to an investor’s needs. For example, an aggressive investor might be interested in a fund with an aggressive growth, international-stock, or corporate-bond high-yield objective. A conservative investor might lean toward a fund with a balanced, government-bond, or growth-and-income objective.
Secondary objectives, which are also included in the program, can provide further insight into a fund’s underlying investment approach. For more information, see Special Criteria and Morningstar Category.