Group Membership: Which groups, if any, this portfolio is a member of. Clicking the name of a group allows you to see all of that group’s members.

Share a Portfolio

Many of our users track model portfolios in addition to their own personal holdings. Others may have multiple portfolios for different objectives. All of these make great candidates for shared portfolios, as you can solicit feedback from other investors as well as get a star rating to better compare portfolios side by side. Share one or more of your portfolios by clicking the Profile tab (start with the Join tab if you don’t have a Discuss account), then select Portfolio Sharing to see a list of your transaction portfolios. When you select a portfolio to share, you can enter a name and strategy, join a group, opt to hide your star rating, or limit your portfolio to just your favorite users.

The groups feature allows you to join investment clubs and contests for easy comparisons against other group members. The best way to find groups you may want to join is to scan existing portfolios of interest to see if they are part of a group. To join a group, return to the Portfolio Sharing tab (within the Profile tab) and begin typing the group name in the Group Membership field. As you type, we will automatically find the closest group name and auto-fill the rest for you.

If you prefer, you can limit access to your portfolio to just your favorite users in Discuss. Click the Profile tab, then Favorites to see who is on your favorites list. (To add an author as a favorite, click the Favorites dropdown under any post by that user.) In this restricted mode, other users will not be able to access your portfolio or see it in the lists of shared portfolios.

One year of portfolio history is needed to calculate a star rating and Growth of $10,000 graph, with three-plus years preferred for greater accuracy. If you don’t have three years of history recorded, you can back-fill historical transactions in your portfolio using the Portfolio Manager tool. Any changes made prior to sharing will be reflected immediately upon sharing, and those changes made after sharing will be updated overnight.

Morningstar Rating for Portfolios

Since 1985, the Morningstar Rating for funds has given investors and advisors a way to evaluate the risk-adjusted return for a mutual fund compared to its peer group. Often called the star rating, this measure is a quantitative assessment of past performance — both return and risk — as measured from one to five stars. In August 2008, Morningstar began rating individual investors’ portfolios so they could compare their performance to similar open-end funds.

The Morningstar Rating for portfolios uses a similar methodology to the Morningstar Rating for funds. Portfolios are rated against a peer group of the open-end funds in the same Morningstar Category, comparing risk-adjusted returns for the three-, five-, and 10-year time periods. The overall rating is a weighted average of the available time-period ratings. Portfolios with only one or two years of history are compared against the peer group’s three-year risk-adjusted returns to calculate the rating.

For portfolios with over one year of history, a Morningstar Risk-Adjusted Return and Morningstar Category are first identified. For calculating the portfolio’s Morningstar Risk-Adjusted Return, we start with the total return reported by the Portfolio Manager tool on the My Performance screen. This return is then adjusted for the excess return over the risk-free rate and for risk. Morningstar’s risk adjustment is based on expected utility theory. Morningstar measures the amount of variation in the portfolio’s monthly returns and how investors would trade off return for less risk.

The Morningstar Category is determined based on the portfolio’s current holdings, with 13 categories used for classifying portfolios: large growth, large value, large blend, mid-cap growth, mid-cap blend, mid-cap value, small growth, small blend, small value, world stock, world allocation, moderate allocation, and conservative allocation. In the final step, Morningstar assigns ratings to portfolios by comparing them to category peers, as explained below, thereby making the portfolio ratings comparable to the open-end fund ratings. While fundamental differences exist between portfolios and funds, the open-end universe is used for its large size, providing a more representative group for comparisons than other shared portfolios alone.

Morningstar rates open-end funds against their category peers using risk-adjusted returns and the bell curve distribution shown below. The breakpoints between each rating level are recorded, and then Morningstar rates portfolios by comparing their risk-adjusted returns to these breakpoints. For example, the illustration shows sample breakpoints for the large-growth category for the three-year time period. A portfolio in the large-growth category with a risk-adjusted return of 14.00% would receive a 4-star rating for that time period.