Putting the Morningstar Style Box to Work

When you look at a fund's Morningstar style box, you immediately get some insight into the manager's investment strategy. A growth portfolio will mostly contain higher-priced companies that the manager believes have the potential to increase earnings faster than the rest of the market. A value orientation, on the other hand, means the manager buys stocks that are cheap, but that could eventually see their worth recognized by the market. A blend fund will mix the two philosophies: The portfolio may contain growth stocks and value stocks, or it may contain stocks that exhibit both characteristics.