CHICAGO, March 15, 2012 /PRNewswire/ -- Morningstar, Inc.
(NASDAQ: MORN), a leading provider of independent investment
research, today announced that Roger
Ibbotson, Peng Chen, and
Kevin Zhu received the Graham and
Dodd Scroll Award from the CFA Institute Financial
Analysts Journal (FAJ) for the research paper, "The ABCs
of Hedge Funds: Alphas, Betas, and Costs," published in the
January/February 2011 issue of the
FAJ. This is the ninth Graham and Dodd Award or Graham and
Dodd Scroll Award granted for financial writing to employees of
Morningstar or its subsidiary Ibbotson Associates.
In the paper, Ibbotson, Chen, and Zhu examined whether or not
hedge fund managers, on average, produce returns that justify their
fees. They adjusted hedge fund return data for biases and then
broke down the returns into alpha (portion of return generated by
the manager), beta (portion of return generated by the markets),
and cost (portion of return that goes to fees). The authors found
that the average hedge fund manager produced significantly positive
alpha during the time period studied and that the average hedge
fund manager added value in both bear and bull markets. The
complete paper can be found at www.cfapubs.org.
"Despite the growing mainstream use of hedge funds, they're
largely unregulated, which makes accurate measurement of
performance difficult. They are also generally more expensive than
traditional investments, so it begs the question of whether the
performance justifies the cost," said Joe
Mansueto, chairman and chief executive officer of
Morningstar, Inc. "This work sheds light from a historical
performance perspective on an opaque area of the market, and allows
investors to make more educated decisions. We are thrilled that
Roger, Peng, and Kevin have been recognized with this most
prestigious honor for their contributions to the field."
Roger Ibbotson, Ph.D., is founder
of Ibbotson Associates, professor of finance at Yale School of
Management, and partner at Zebra Capital Management. Morningstar
acquired Ibbotson Associates in 2006 and Roger Ibbotson serves as a management advisor to
Morningstar. Peng Chen, Ph.D., CFA,
is president of Morningstar's global Investment Management
division. Kevin Zhu, Ph.D.,
previously worked for Morningstar as a senior research
consultant.
Awarded by the FAJ's Advisory Council and Editorial
Board, the Graham and Dodd Scroll Award is given in recognition of
excellence in research and financial writing. The FAJ is
published six times a year by CFA Institute, the worldwide
association of more than 105,000 securities analysts, portfolio
managers, strategists, consultants, and other investment
specialists. The Journal advances the knowledge and
understanding of the practice of investment management through the
publication of high-quality, practitioner-relevant research. The
Graham and Dodd Awards were established in 1960 to recognize
excellence in financial writing and to honor Benjamin Graham and David L. Dodd for their enduring contributions
to the field of financial analysis.
About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment
research in North America,
Europe, Australia, and Asia. The company offers an extensive line of
products and services for individuals, financial advisors, and
institutions. Morningstar provides data on approximately 375,000
investment offerings, including stocks, mutual funds, and similar
vehicles, along with real-time global market data on more than 8
million equities, indexes, futures, options, commodities, and
precious metals, in addition to foreign exchange and Treasury
markets. Morningstar also offers investment management services
through its registered investment advisor subsidiaries and has more
than $180 billion in assets under
advisement and management as of Dec. 31,
2011. The company has operations in 27 countries.
©2012 Morningstar Inc. All rights reserved.
MORN-R
Media Contact:
Alexa Auerbach 312-696-6481,
alexa.auerbach@morningstar.com
SOURCE Morningstar, Inc.