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This would be big news if it was PIMCO Total Return PTTRX (which is in fact having a blockbuster year), but instead the fund being downgraded is PIMCO Global Multi-Asset PGAIX, i.e. just one of of PIMCO's 50-or-whatever other funds. Personally I think Rob Arnott's PAAIX / PAUIX is the better of the tactical asset allocation funds, so this is not surprising to me.
Also the "fund rating" mentioned is Morningstar's new gold / silver / bronze ratings. WallStreetRant has a nice post about how these ratings seem pretty meaningless given that pretty much any fund seems to get at least a bronze.
Reply to @claimui: And was it WSR who also pointed out that M* gives gold ratings to some index funds, which appears to fly in the face of the stated ratings criteria?
Edit: to be more explicit, an index fund can't logically get better than an average score on 3 of the 5 M* "pillars" -- process, performance, and people (this latter 'cause how much can it matter who manages an index fund?) -- so how then could it possibly get a best-of-class score?
Reply to @AndyJ: Evidently you are not familiar with some of the newer concepts in scoring. Adjustments must be made lest we inadvertently cause personality issues due to perceived low self-esteem. By allowing everyone to occasionally be "best-of-class" we insure that we will have mentally healthy managers who will be in minimal need of professional psychological assistance as they fight their way through the world of finance. Everyone is a winner!!
It is just amazing to me that most of the larger media folk have bought the M* medal ratings. M* says otherwise, but the number of positive and negative category ratings do not often lead to what the final medal rating is. And it is certainly not consistent from fund to fund. Personally I have ignored these and told clients to ignore them, too, just as we ignore the star ratings. Our M* Office database screens omit the star and medal ratings altogether.
For years, M* folks told everyone that there was no way to predict future results. Now, all of a sudden, they believe their medal system will actually do that?
OldJoe, you made a great statement! Thanks for adding some humor here.
Comments
Also the "fund rating" mentioned is Morningstar's new gold / silver / bronze ratings. WallStreetRant has a nice post about how these ratings seem pretty meaningless given that pretty much any fund seems to get at least a bronze.
Edit: to be more explicit, an index fund can't logically get better than an average score on 3 of the 5 M* "pillars" -- process, performance, and people (this latter 'cause how much can it matter who manages an index fund?) -- so how then could it possibly get a best-of-class score?
For years, M* folks told everyone that there was no way to predict future results. Now, all of a sudden, they believe their medal system will actually do that?
OldJoe, you made a great statement! Thanks for adding some humor here.