Morningstar’s first global study of investor returns evaluates impact of investor behaviour and finds automatic savings plans produce better outcomes
Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research, today published its first global study of investor returns, “Mind the Gap 2017,” which measures how the average investor fared in a fund and the impact investor behaviour can have on investment outcomes. The study uses the Morningstar Investor Returns methodology to derive a dollar-weighted return of a fund that incorporates the effect of cash inflows and outflows from purchases and sales, as well as the increase in a fund’s assets. The “gap” refers to the shortfall between funds’ money-weighted and time-weighted returns, reflecting how opportunely investors have timed their investments.