Ive been a Morningstar premium member for about ten years now. They are a great resource to help assist you in your investment decisions.

Their ratings system is universally known throughout the investment community. Originally they only reviewed mutual funds, but a few years ago added stocks to their reviews.

Personally I look at services like Morningstar as a way to help speed up my research. You should always do your own investment research, and not take what anyone says as gospel. This review has been updated for 2014.

In the three years since I did my original review in 2010, not much has changed with their website service, though they have improved mobile access via smartphones or tablets.

First, I guess I should disclose my investment strategy. Im a fundamental/value investor, and maybe one day Ill discuss why I believe its the best way to invest. You will not see me discuss technical indicators on this blog, as I think they are akin to reading tea leaves, or seeing animals in the clouds.

Morningstar is the perfect service, if you believe in fundamental/value investing. If you are a chartist then Morningstars service is not for you. Their website will not discuss technical charts when you should buy or sell via indicators like the stock passing the 52-week average.

Morningstar is more about proper asset allocation. low fee investments vehicles, and investments that generate consistent returns. I use Morningstar Premium service because:

• Investment Thesis The analysis of stocks, mutual funds and ETFs. It gives pros and cons for any investment (they call Bulls and Bears).
• Growth of $10k over time How has the investment performed in real terms that allows you to compare to other investments.

• Stock and mutual fund screener Find investments via hundreds of key data points.
• The yearly annual returns (with dividends included).
• The performance comparative a benchmark category.
• Actionable Analyst Reports (over 2,000 funds, ETFs, and stocks).
• The allocation of mutual fund into specific investment categories and stocks.
• If a stock has dividends the payout amounts over time.
• The annual fees to own an ETF or mutual fund. An important aspect often missed. Typically the lower the cost, the better odds to meet or beat the comparative index.
• Their X-Ray tool is second to none and ensures you arent over allocated in a specific sector, country or stock.
• Their free and premium screeners. It offers a quick method to narrow your selection of a stock or mutual fund.
• The Cost Analyzer is also a great tool to help pick one ETF/mutual fund over another.

Portfolio X-Ray tool

Break down your Asset Allocation (click to enlarge)

While a mutual funds prospectus will state its allocation in only US based companies, the statement may not be completely true. Morningstar takes a mutual funds quarterly SEC reporting of their individual stock ownership, and uses it to help determine your true asset allocation. So while on a macro level you may have the correct asset allocation, you could be heavily weighted in a particular stock or category unknown to you. This could unknowingly increase your investment risk and decrease returns.

In my original review, I wrote how great the X-Ray tool was in 2010. The problem today is there are many other alternatives, and X-Ray hasnt been improving. Some of the competitors are offering free high level analysis like Personal Capital thats decent enough for the average investor.

While Morningstars X-Ray does go into great detail about your asset allocation, its a manual process to do this. The X-Ray service does support the ability to import Quicken files, but unfortunately from my tests I was never able to get this working correctly. So while Morningstars X-Ray tool is still useful, its too cumbersome compared to the alternatives and needs improvement.

Though if you do want to integrate Quicken with Morningstar, I recommend the latest version of Quicken 2015 for Windows. The premier version of Quicken comes with Morningstars X-Ray service, and automatically links up all of your investment accounts No fuss, no muss. In addition The cost of Quicken Premier is much cheaper than an annual cost of Morningstars service if you only want to use X-Ray. So it might be a cheaper option as well.

iPad and iPhone Apps

iPad App (click to enlarge)