Four managers have suffered significant downgrades in their Morningstar ratings for a variety of reasons. Two of the funds have suffered because of people changes, one has been downgraded because of poor information flows and the fourth has been affected because it's more like a bank account than a managed fund.
Morningstar has moved Equitable from being a four star, or "very good fund manager" to the status of "ratings temporarily suspended pending possible downgrade" because of a lack of information.
"Morningstar's qualitative research analysts have been concerned about the recent level of information received from Equitable by Morningstar, and the consequent effect on the currency and accuracy of, and our inability to confirm the currency and accuracy of, Morningstar’s data and ratings for Equitable," the research house says in its latest report.
Morningstar says it is now doing a full review of Equitable, and it has been promised full co-operation from the company. Until that is completed Equitable, which was a sector finalist in Morningstar's Fund Manager of the Year Awards this year, has had its rating suspended.
Macquarie, which has just one fund in New Zealand - the Gilt Edge Access Account - has been moved to the 'not yet rated' status as Morningstar considers it to be more like a bank account than a managed fund.
Morningstar is currently reviewing Macquarie's parent company in Australia, which manages the GEAA.
"Morningstar has decided to exclude the Macquarie Gilt Edge Access Account from the review, because of its close approximation to a bank account," the company says.
On the people front Armstrong Jones' Sector Strength Rating for its Australian Equities fund has been downgraded, because of team changes, and Colonial First State's sector strength rating for its international equities fund has been downgraded because for the same reason.
Good Returns was unable to get comment from managers last night.
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