Calvert US Large-Cp Div, Eq AndIncETF’s management team is rated Average, but a solid investment process still helps this strategy retain its Morningstar Medalist Rating of Silver. The portfolio maintains a cost advantage over competitors, priced within the lowest fee quintile among peers.  

 The strategy's effective investment philosophy supports a High Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an overweight in liquidity exposure and an underweight in yield exposure compared with category peers. High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And a low yield exposure is rooted in holding fewer stocks with high dividend or buyback yields -- instead, typically holding stocks in an early stage of development. The strategy’s management team earns an Average People Pillar rating. The strategy's parent organization earns the firm an Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Microsoft

Apple

Eli Lilly

Broadcom

JPMorgan Chase & Co

UnitedHealth Group

Visa

Mastercard

Home Depot

Merck

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. Calvert US Large-Cp Div, Eq AndIncETF earns a High Process Pillar rating. The largest contributor to the rating is its parent firm's impressive long-term risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 3.4 stars. The parent firm's five-year risk-adjusted success ratio of 64% also strengthens the process. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. Their relatively high success ratio suggests that the firm does well for investors and that this fund may benefit from that. This fund tracks an index, which supports the rating. Historical data, like Morningstar's Active/Passive Barometer, shows that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons.

The investment strategy as stated in the fund's prospectus is:  The investment seeks to track the performance of the Calvert US Large-Cap Diversity Research Index.  Under normal circumstances and the fund invests at least 80% of its net assets (plus any borrowings for investment purposes) in securities included in the underlying index. The index is composed of common stocks of large companies that operate their businesses in a manner consistent with the Calvert Principles for Responsible Investment. The fund is non-diversified. 

 The portfolio is overweight in technology and healthcare relative to the category average by 13.7 and 4.4 percentage points, respectively. The sectors with low exposure compared to category peers are communication services and consumer cyclical, underweight the average by 4.4 and 4.2 percentage points of assets, respectively. The strategy owns 350 securities and is diversified among those holdings. In its most recent portfolio, 44.2% of the portfolio's assets were concentrated in the top 10 fund holdings, compared to the category’s 48.8% average. And finally, in terms of portfolio turnover, on a year-over-year basis, 19% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.

High

Process

Eaton Vance’s  team is comparable to peers, resulting in an Average People Pillar rating. There are two managers listed on the fund: James Reber, Thomas Seto. Experience on the team is abundant, with over 25 years of average portfolio management experience. Together, they manage a total of four strategies, with a Bronze asset-weighted average Morningstar Medalist Rating, demonstrating their potential to deliver positive alpha relative to the category median in aggregate. The team has lacked continuity recently, with Matthew Maillet leaving within the last month, detracting from its rating. Even though it is a passive fund, high turnover can still hinder the effectiveness of the investment process. 

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

Average

People

Morgan Stanley Investment Management, the asset-management arm of Morgan Stanley MS, has made progress in integrating Eaton Vance's capabilities, but there remains more to be done. It retains its Average Parent rating.
Since acquiring Eaton Vance in March 2021, MSIM has been conservative in its approach to the merger. The firm kept Eaton Vance's legacy equity team a distinct platform from MSIM's own substantial capabilities, and it now offers several funds with potentially competing mandates. On the other hand, it moved relatively quickly to centralize the two legacy firms' fixed-income platforms, though several team leaders retired or departed the firm over 2021 and 2022. 
Although Counterpoint Global's concentrated growth strategies, historically among MSIM's largest offerings, have struggled through 2021 and 2022, some of Eaton Vance's boutiques, including value-equity shop Atlanta Capital, help create a more-diversified lineup. MSIM has leveraged Calvert's substantial experience in sustainable investing to launch a series of Calvert-branded strategies both in the United States and Europe, and Parametric allows MSIM to compete in the fast-growing area of customized separate accounts. The firm has yet to demonstrate, however, that it has leveraged its increased size and scale to streamline and improve its operations or to systematically lower fees for its investors.

Parent

Calvert US Large-Cap Diversity Equity And Inclusion Index ETF

CDEI tracks a market-cap-weighted, ESG-screened index of large-cap stocks from the US. Company selection emphasize those invested in employee diversification practices.

Calvert International Responsible Index ETF

Calvert US Large-Cap Core Responsible Index Etf

Calvert US Mid-Cap Core Responsible Index Etf

Calvert Ultra-Short Investment Grade Etf

Calvert US Select Equity Etf

Eaton Vance High Yield ETF

Eaton Vance Intermediate Municipal Income ETF

Eaton Vance Ultra-Short Income ETF

Parametric Equity Premium Income ETF

Parametric Hedged Equity ETF

Morgan Stanley Investment Management's lineup of ETFs has grown to over half a billion dollars in assets since their launch last year. The firm entered the ETF space one year ago with the launch of six Calvert ETFs.

Morgan Stanley Investment Management's Calvert ETFs Turn 1

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Despite Criticism, ESG Is Mainstream and Desired

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Work to Be Done to Improve ESG Adoption

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Why ESG Investing Still Matters

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Consider CDEI for Values-Based Investing

If there's one element in the environmental, social, and governance (ESG) equation that companies, governments, fund issuers, and asset allocators have long grappled with, it's the “S.” That's not surprising because social causes and issues are broader and more fluid, particularly from an investment perspective, than are environmental and governance issues.

An ETF for More Emphasis on the “S” in ESG

Amid evolution in the environmental, social, and governance (ESG) space, focus is shifting to the “social” aspect. In fact, more asset allocators and fund managers are demanding that companies place more emphasis on social matters.

Equal Pay Prime Opportunity for Boosting ‘S' in ESG

With more scrutiny on environmental, social, and governance (ESG) as a corporate methodology and as an investing style, asset allocators are demanding more action on the social and governance fronts. As the acronym implies, those are two distinct issues.

With More Focus on the S in ESG, Consider This ETF

When it comes to environmental, social, and governance (ESG), professional and retail investors alike are demanding more on the social and governance fronts. That stands to reason, because the “E” gets plenty of attention by way of climate change and net-zero efforts.

DEI Has Investment Merit

Some companies have impressive environmental, social, and governance (ESG) and sustainable investing resumes. Others are working on it, while others could take a while to make related improvements.

ETFs Boost Access to Sustainable Investing Strategies

Anthony Rochte, Morgan Stanley managing director, global head of ETFs, joined senior responsible investment strategy specialist Lenore Reiner and Calvert Research and Management chairman John Streur to discuss global leadership trends in asset management, digging into ESG.

Calvert and Morgan Stanley Are Thinking Long-Term on ESG

SPDR Bloomberg High Yield Bond ETF

ETF Edge, hosted by Bob Pisani, was live from Exchange in Miami and featured Dave Nadig, financial futurist at Vettafi, alongside Vance Barse, founder of Your Dedicated Fiduciary, and Anthony Rochte, global head of ETFs at Morgan Stanely, to talk advisor insights from the floor of the conference, market trends, and more.

Dave Nadig Shares Insights From Exchange and More on “ETF Edge”

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Morgan Stanley Launches 6 Calvert ESG Funds

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Morgan Stanley Crashes the ETF Party With ESG

Morgan Stanley MS +1.02% is expanding further into retail investing with its first exchange-traded funds, but faces a crowded field where legions of ETFs struggle to gain traction.

News for Calvert US Large-Cap Diversity Equity And Inclusion Index ETF ETF (CDEI)