Our Morningstar Medalist Ratings look at long-term fundamentals. We aren’t trying to call the next six months. Rather, we focus on key attributes like investment personnel, strategy, fund company, fees, and opportunity to add value to arrive at a Medalist Rating. If we think a fund has enduring competitive advantages that will overcome its fees, it earns one of the higher Medalist Ratings—Gold, Silver, or Bronze.

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Let’s look at some of 2024’s biggest rating upgrades. I limited the list to funds where fundamental improvements drove upgrades to one or more of the pillars of the Medalist Rating—People, Process, or Parent—and also led to an overall rating improvement. (To really understand our upgrade rationales, please read the full analyst reports.)

JPMorgan Core Bond PGBOX

We raised the fund’s Process and People ratings to High from Above Average. That boosted the $49 billion fund’s A shares to Silver from Neutral. As Senior Analyst Paul Olmsted dug deeper into the fund, he became more confident in the team and process. “Rick Figuly effectively leads this fund’s value-driven comanagers who draw on the vast resources of its global fixed-income platform and makes use of them in navigating personnel changes,” Olmsted wrote when he upgraded the fund in March. “The firm’s quarterly investment meeting of senior investors across the globe drives macro themes for the subsequent three to six months, but the real work here takes place among the fund’s managers, with frequent formal and informal collaboration to uncover good relative value opportunities.”

Fidelity Floating Rate High Income FFRHX

We raised this fund’s Process rating to High, taking the overall rating to Gold from Silver in February. The People Pillar was already High. “Fidelity’s size and presence in the bank-loan market give this strategy a unique edge extending beyond the fundamental credit research that has long been the hallmark of this high-income research team,” writes Max Curtin. “With a dedicated capital markets solutions advisor honing relationships with private equity sponsors, this group takes advantage of harder-to-source deals and favorable allocations compared with smaller players in the asset class.”

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Fidelity Capital and Income FAGIX

We boosted this fund from Bronze to Silver and its People Pillar from Above Average to High in July. “The combination of managers Mark Notkin and Brian Chang inspires confidence in the near- and long-term prospects of this strategy,” writes Analyst Max Curtin. “A proven veteran, Notkin joined Fidelity as a high-yield credit analyst in 1994. He began managing high-yield portfolios two years later and has now stewarded this strategy with great success for over two decades. Comanager Brian Chang has learned under Notkin’s guidance since rising to portfolio management from the high-yield research team in 2017; the firm officially named him to the portfolio in 2019.”

American Funds Mortgage MFAEX

In July, we raised this fund’s People rating to High from Above Average and the overall rating to Silver from Bronze. “Keeping tabs on the likely path of interest rates is key to this fund’s agency MBS-centered approach,” writes Director Alec Lucas. “The managers’ views on interest rates along with the yield premiums of MBS over Treasuries inform their willingness to increase MBS exposure to around 90% of portfolio assets (as they did in 2024’s first quarter) or to drop to about 50% (as they did in late 2021).” The fund’s 0.62% expense ratio for its F1 share class is available in No Transaction Fee platforms.

FPA New Income FPNIX

This conservative bond fund earned a Process upgrade to High while maintaining an Above Average for People and High for Parent, driving an overall upgrade to Silver. This is a fund you use to play defense rather than seeking maximum returns. “That style dovetails with goals its managers have maintained for several years: gaining at least 100 basis points over the Consumer Price Index over five-year periods and positive returns ‎over 12-month stretches, within a high-quality mandate,” Director Eric Jacobson wrote. “Given those parameters, they kept the fund’s duration short—even versus its short-term peers—beginning in early 2002. That metric stayed under 2.0 years through mid-2023. Its leaders have always had the flexibility to take duration longer but have said it would require major shifts in market yields.”

Fidelity Growth Discovery FDSVX

We raised this to Silver from Bronze on the back of a Process upgrade to Above Average in April. The People Pillar was already Above Average. Managers Jason Weiner and Asher Anolic have executed this strategy well. “The managers seek companies poised to outperform thanks to solid, durable earnings growth,” writes Senior Analyst Todd Trubey. “The duo focuses on quantitative metrics such as revenue growth and gross margins as well as qualitative traits such as competitive advantages. The upgrade to their Process rating comes because they are unusually rigorous in their quant analysis and also more thoughtful in their qualitative assessments, striving to match firms’ operations to mental models so they can assess not just that a company thrives but how it does so.”

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JPMorgan International Focus IUAEX

This fund does a very difficult thing well: running a focused portfolio without excessive risk. We raised the fund’s Process rating to High and the overall rating to Silver. The fund “focuses on non-US firms that score well on balance-sheet strength, profitability, and management quality. Idea generation relies on this team’s global sector specialists, who scour the best ideas from J.P. Morgan’s vast regional equity research teams, which cover approximately 2,500 stocks around the world, by viewing their research with a global lens,” writes Associate Director Andrew Daniels. “The global specialists ultimately rank stocks from A to C, with A representing their highest-conviction bets, a framework that helps form position-sizing decisions. The team is long-term-oriented—it sets five-year expected return targets—so it’s no surprise that annual portfolio turnover trends around 30%.”

Oakmark International Small Cap OAKEX

This fund requires a ton of patience, but it can be rewarding. We raised its People rating to High, taking the overall rating to Gold. “While longtime manager David Herro remains listed here, he has delegated some responsibilities to Michael Manelli and Justin Hance, who have been working with increasing autonomy since becoming comanagers in 2011 and 2016, respectively,” writes Daniels. “Manelli and Hance have good credentials, but more importantly have proved to be savvy small/mid-cap investors under Herro’s mentorship. They consistently impress in interviews, are in sync with the team’s philosophy, and invest heavily in the offering.”

Vanguard Global ESG Select Stock VESGX

This Wellington-run fund has really impressed in its first five years. We raised our Process rating to Above Average and the overall rating to Silver. The “process is sensible and has been executed very well,” writes Senior Analyst David Kathman. “The managers use quantitative screens to narrow down the investment universe before doing a fundamental deep dive on the most promising names, looking for global large-cap companies that combine positive environmental, social, and governance features with high and consistent returns on capital. They aim to keep the portfolio reasonably diversified by sector and region while maintaining a fairly concentrated portfolio of 35-45 stocks.”

AMG River Road Small Cap Value ARSVX

We raised this fund’s People rating to High and the overall rating to Silver in March. “Lead manager Justin Akin joined the firm in 2005 and has worked on this strategy since, first serving as an analyst and then as a comanager starting in March 2012, writes Analyst David Carey. “Akin then took the lead in July 2014. Comanager Andrew Beck, who cofounded River Road in 2005 and is the firm’s CEO, supports Akin in his research efforts. Since the duo started working together nearly 20 years ago, they, along with other River Road managers, developed the firm’s proprietary position-sizing model and a framework to gauge conviction more consistently and quantitatively across portfolio holdings. These enhancements made the process more repeatable and less susceptible to key-person risk.”