Mutual fund research company Morningstar has begun rating hedge funds.

The company has launched a Morningstar Rating for hedge funds as well as the Morningstar 1000 Hedge Fund Index (MHFI 1000) and 17 indexes based on the Morningstar Hedge Fund Categories. Similar to the Morningstar Rating for mutual funds, the new rating system for hedge funds uses a scale of one to five stars.

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