Morningstar Inc. President Don Phillips said Thursday the mutual fund research company has no plans to follow the example of rival Lipper Analytical Services Inc. and forfeit its independence.
Lipper, the leading provider of mutual fund research to institutional investors, Thursday agreed to be acquired by Reuters Group PLC for an undisclosed sum.
Chicago-based Morningstar is regarded as the most successful fund research company serving the individual investor market with research about funds and managers.
At the same time, Phillips didn’t rule out the possibility of privately owned Morningstar raising money by selling shares to the public or joining forces with another company.
Lipper’s move “doesn’t hit us directly,” Phillips said in an interview. “We set our agenda that this was going to happen.”
Distinguishing Lipper and Morningstar is the volume of data and information each gathers and processes about mutual funds.
Lipper is widely followed by funds’ boards of directors, while Morningstar is frequently quoted by the media, ensuring it will have a wide public following.
Morningstar has made a name for itself and helped establish its brand identity with such innovations as rating funds by numbers of stars, with a five-star ranking the ultimate compliment.
Fund companies frequently incorporate Morningstar’s research in their marketing if one of its funds has received a favorable rating.
