Static Portfolios† that invest in a predetermined mix of stocks and bonds so that regardless of the beneficiary's age, the target assets allocations remain unchanged throughout the life of the account. The portfolio's investment in many underlying funds means they will be exposed to the risks of many areas of the market. Investors should note: the higher the portfolio's allocation to stocks, the greater the risk.
Morningstar analysts reviewed 64 plans for both its 2013 ratings (10/22/13) and 2012 ratings (10/15/12), of which 4 plans received a "Gold" rating. To determine a plan's rating, Morningstar's analysts considered five factors: the plan's strategy and investment process; the plan's risk-adjusted performance; an assessment of the individuals managing the plan's investment options; the stewardship practices of the plan's administration and parent firm; and whether the plan's investment options are a good value proposition compared to its peers. Plans were then assigned forward-looking ratings of "Gold," "Silver," "Bronze," "Neutral," and "Negative." 21 of the industry's smallest plans were not rated in 2013 and 22 were not rated in 2012.
Analyst Ratings are subjective in nature and should not be used as the sole basis for investment decisions. Analyst Ratings are based on Morningstar analysts' current expectations about future events and therefore involve unknown risks and uncertainties that may cause Morningstar's expectations not to occur or to differ significantly from what was expected. Morningstar does not represent its Analyst Ratings to be guarantees.