A sound investment process and strong management team underpin Eaton Vance Ultra-Short Income ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a sizable cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy's effective investment philosophy earns it an Above Average Process Pillar rating. The strategy’s management team earns an Above 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

Morningstar's style-agnostic investment process evaluation looks for strategies that should be able to outperform their Morningstar Category index on a risk-adjusted basis over time. Eaton Vance Ultra-Short Income ETF earns an Above Average Process Pillar rating.    The most notable contributor to the rating is the parent firm's five-year risk-adjusted success ratio of 62%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent firm's impressive risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.4 stars, also supports the process. Lastly, the process is limited by the parent firm's five-year retention rate of 77%, which suggests it could do more to hold onto its portfolio managers.

 Compared with other funds in the Ultrashort Bond Morningstar Category, this fund, historically, hews closely to peers' credit and interest-rate sensitivity over the past few years. Moreover, it has no significant biases in terms of credit quality, bond sectors, or maturity when compared to its category peers in recent years.   

  The portfolio's average surveyed credit quality is on par with peers, with both the fund and the average being rated A.

Above Average

Process

Eaton Vance Ultra-Short Income ETF earns an Above Average People Pillar rating. Brandon Matsui’s veteran status, with over 25 years of listed portfolio management experience, brings a wealth of experience to the table. The average Morningstar Rating of the strategies they manage is 4.0 stars, demonstrating excellent risk-adjusted performance versus category peers. Brandon Matsui is supported by an experienced team, being able to draw on four additional listed managers, who average 20 years of listed portfolio management experience. As a team, they manage two investment vehicles together, with a Bronze asset-weighted average Morningstar Medalist Rating, demonstrating their potential to deliver positive alpha in aggregate. None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

 Note: The People Pillar rating is indirectly assigned by an analyst. The longest-tenured manager of the fund also manages a different product rated by an analyst. Their analyst-assigned People Pillar rating is combined here with the People scores (algorithmic or analyst-assigned) for the fund’s other managers on a tenure-weighted basis.

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.

Average

Parent

Eaton Vance Ultra-Short Income ETF

EVSB is actively managed, investing in a broad portfolio of investment grade debt securities globally. The fund aims for an average portfolio duration of one year or less.

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