Morningstar’s 3×3 “style box” for stock mutual funds has always been a useful tool for showing what portion of the fund is allocated to each category of stocks (e.g., large-cap growth, small-cap value, etc.). When the style box was originally created, the allocation of the overall stock market was by definition one-third growth, one-third blend, and one-third value. However, due to the explosive returns of large-cap growth stocks over the last several years, now even a “total stock market” index fund is categorized as a large-cap growth fund.
Allan Roth discusses the topic, as well as an update that Morningstar will be making in the near future:
Other Recommended Reading
Thanks for reading!
New to Investing? See My Related Book:
|
Investing Made Simple: Investing in Index Funds Explained in 100 Pages or Less
|
Topics Covered in the Book:
- Asset Allocation: Why it’s so important, and how to determine your own,
- How to to pick winning mutual funds,
- Roth IRA vs. traditional IRA vs. 401(k),
- Click here to see the full list.
A Testimonial:
“A wonderful book that tells its readers, with simple logical explanations, our Boglehead Philosophy for successful investing.”
– Taylor Larimore, author of The Bogleheads’ Guide to Investing
July 22, 2024
