Lonsec Research
Benefit from a Lonsec rating
Lonsec has been rating investments for over 30 years, covering equity funds, LITs and LICs, super options, direct equities and SMAs across the ASX 200. More recently, we have expanded our coverage to include private markets and products issued under an Information Memorandum. We now cover more than 2,000 products, and that number continues to grow strongly.
We understand the value of trusted, objective investment insights and their role in supporting better outcomes for end investors. A Lonsec rating can give financial advisers confidence that a product meets its objectives and may be suitable for their clients. It is also often the first step towards a fund’s inclusion in model portfolios, approved product lists and platforms.
The Lonsec approach to research and ratings
Over the past 30 years, we have developed a tried and tested methodology to evaluate funds that looks at everything from the investment team to the sustainability of the business, fees and performance to give a holistic, qualitative assessment of the fund.
We believe that investment research should be forward-looking and qualitatively skewed. As such, qualitative factors generally account for 80% of the rating for most mainstream asset classes, with Lonsec’s assessment of people and process having the greatest impact on the research outcome.
A key component of the research process is our robust scoring models that have been developed over time and are reviewed on an ongoing basis by senior members of the Lonsec Research team. These scoring models are dependent upon by both data collected as part of the review process and the expertise of the analyst team in assessing the information gathered.
It’s important to note that these models are not a replacement for the human intellectual capital of our researchers but are to ensure that we consistently apply the Lonsec ‘house views’ to each and every fund that we rate.
Our rigorous research process is skewed towards qualitative factors
High-level sector review
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Key Inputs
PDS & Additional manager material
Lonsec corporate FSC questionnaire
Face-to-face
meetings
Performance data & Lonsec’s rating model
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80%
Qualitative assessment
20%
Quantitative assessment
People & resources
Investment philosophy (style)
Research process
Portfolio construction
Risk management
Lonsec financial product review
Historical performance data
Risk & return metrics
Consistency of performance
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Peer review
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Ratings & report published
Trusted by financial advisers
Our rigorous ratings system provides financial advisers with the insights they need to support their clients’ investment objectives. Our ratings are underpinned by our peer review process, which draws on the full expertise of our investment research team.
The rating system designates financial products under the categories of Highly Recommended, Recommended, Investment Grade, Fund Watch, Redeem and Screened Out. These ratings reflect Lonsec’s degree of conviction in the financial products’ ability to generate risk adjusted returns in line with relevant objectives.
Lonsec Consistency Seals
We have recently launched the Lonsec Consistency Seals to recognise products with consistently high ratings over five years or more. These logos can be used alongside Lonsec Research Ratings to give advisers investors added confidence that products have performed highly against the core research rating parameters over a sustained period of time.
Find out more
To find out more, get in touch with Lonsec Research Sales.