In a universe of over 20,000 offshore funds, how do expats sort the good from the bad? There are never any guarantees, but Morningstar ratings together with S&P management ratings can help. For these ratings, all offshore funds are scrutinised by Morningstar and S&P on past performance (a three-year period is examined, not the less reliable one-year usual), fund manager experience, background audits, face-to-face interviews and on-going fund surveillance. So stringent are the tests that only 20 per cent of all offshore funds are eligible for a rating, either 'A', 'AA'. or 'AAA'.
'AAA' rated funds are the best; only 50 funds have made the grade. These funds have shown excellent long-term consistency and strong performance, backed-up by an experienced management team. However, as so few funds make the grade, not all fund sectors are represented - there are no 'AAA' funds investing in German companies or Korean government bonds.
One notch down, but still excellent, are the 'AA' rated funds. Just fewer than 300 funds have made the grade here, which means that expats have more choice over fund sectors. And these are still excellent investments.
'AAA', 'AA' and 'A' ratings are constantly monitored and are not indefinite. They are also not guarantees of performance; while many of the funds have outperformed their peers or their benchmarks there is nothing to say they will continue to do so.
For further advice, please contact us by clicking here in order to arrange an introductory meeting. It will only take 20 minutes of your time to see just how valuable these tools are.