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Costs can make or break a fund. Numerous studies from Morningstar and others have shown that few (if any) qualities beat fees for their ability to predict performance. That’s why they’re a big component of Morningstar’s Medalist Ratings. Here are three funds that benefit from strong people and processes but are hampered by high fees.
CI Global Leaders
CI Global Leaders F earns Above Average People and Process Pillar ratings. Longtime managers Bill Kanko and Heather Peirce’s have a patient bottom-up, low-turnover approach to running this highly active portfolio of 25-30 stocks, which gives it a very different performance than the Morningstar Global Markets Index.
However, this share class of the strategy receives a Medalist Rating of Neutral, due in part to its 1.36% fee, which ranks it in the priciest decile of all fee-based equity share classes.
Fidelity Income Portfolio
Fidelity Income Portfolio Series F’s impressive assortment of underlying managers helps it earn a High People rating and an Above Average Process Pillar rating. David Wolf and David Tulk oversee the fund’s allocations among its underlying strategies and put their stamp on the portfolio with tactical trades.
However, the fund’s F share class only has a Bronze Medalist Rating, because its management expense ratio of 0.97% is more expensive than most fee-based allocation share classes.
Sun Life MFS Global Value
A trio of seasoned managers oversee a disciplined quality-value approach, which earns Sun Life MFS Global Value Above Average People and Process ratings. Steven Gorham (who has worked on a US-based separately managed account version of this fund for more than 20 years), works with David Shindler, Jonathan Munko, and a global analyst team to pick stocks from a wide opportunity set. The portfolio had more than 40% of its assets in non-North American stocks as of February 2025.
Positions fit into at least one of three buckets: companies with low expectations, durable franchises generating above-average returns on capital, and turnaround stories. Like all MFS funds, its core strength is in quality investing, but the managers also have shown prowess for investing in value. Still, the overall Medalist Rating for the F share class remains Neutral because its management expense ratio of 1.22% ranks it in the priciest quartile among fee-based equity share classes.
Pay Attention to What You’re Paying
Fees should be among fund investors’ first considerations, because they come right out of performance. They can neutralize the advantages of a good team and process. Two of these three funds had their 10-year outperformance entirely wiped out by their fees as of March 2025.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.
