A: Morningstar Risk Adjustment Rating System (RAR) provides a performance measurement method similar to the mean square deviation measurement. This well-known measure divides funds into five grades. The best RAR gets 5 stars, and the worst RAR has only one star.

In order to determine how many stars the same fund has won, Morningstar system adjusts the income according to the redemption fee, then calculates the income of the fund and measures the risk according to the performance of the fund in the worst year. According to the objectives of the fund and the characteristics of the portfolio, such as the degree of market capitalization and financial ratio, the fund is subdivided into categories.

Next, the fund is rated according to RAR. According to the percentage of the fund, the star is awarded. Get 0 ~ 10 percentile 1 star. 10 ~ 32.5 percentile gets 2 stars, and so on. Get 5 stars within 90 ~ 100 percentile. The calculation of Morningstar system is very well known and recognized by professional investment institutions and small investors.