SQM’s research methodology is comprised of a number of elements that generally require a period of approximately one to three months for completion. These elements include a desktop review, site inspection, and meetings with key fund management personnel.

In general, the assessment incorporates a combination of qualitative and quantitative research techniques to assess Property, Infrastructure and Structured Product Investment Funds.

Information generated is passed through the assessment model at the completion of the assessment process. The assessment model generates a product score, which correlates to a specific star rating (out of a maximum of five stars). Each star rating covers a scoring range, allowing products to be ranked within quarter star increments.

Following are descriptions for each of the star ratings, which have been adopted from Adviser Edge developed as a guide for dealer group research teams and investment committees:

Outstanding: 4.5 stars & above

Highly suitable for inclusion on APLs. The fund most often outperforms its peers and benchmark. In all cases the fund is operating to its mandate and product disclosure statement (PDS). There are no corporate governance issues. Management is extremely experienced and skilled and has access to significant resources.

Superior: 4 to 4.25 stars

Suitable for inclusion on most APLs. The fund outperforms (or is likely to) its peers and benchmark the majority of the time. The fund most of the time has been operating within its mandate and PDS. There are very little to no corporate governance concerns. Management is of a very high calibre.

3.75 stars: Favourable

Consider for APL inclusion. The fund may outperform its peers and benchmark the majority of the time or SQM believes this is a fund that has potential to be an outperforming fund over the medium term. Management is of a quality calibre but may not yet be fully tested. There are no corporate governance concerns or they are of a minor nature.

Acceptable: 3.5

Consider for APL inclusion, subject to advice restrictions. There is some degree of additional risk attached to the fund by way of performance. The fund may periodically underperform its peers and benchmark or it has not been fully tested. There may be some additional concentration risk. Management is generally experienced and capable. There might be corporate governance issues of a mid-level or corners over the Responsible Entities/Parent Entities financial position/performance.

Caution Required: 3.25 stars

Not suitable for most APLs.Performance has been significantly under-benchmark and peers. There is a greater than average risk of underperformance over the medium term. There is a risk of the fund not operating to mandate or to its PDS. There are corporate governance concerns. Management has been operating in an average manner.

Strong Caution Required: 3 stars

Not suitable for most APLs. The fund is unlikely to perform to its mandate over the near term. There might be some greater than average corporate governance concerns. SQM has a number of concerns of management.

Avoid or Redeem: below 3 stars

Not suitable for APL inclusion.


The rating is no longer applicable. Significant issues have arisen since the last report was issued, and investors should avoid or redeem units in the fund.


The rating is currently suspended until SQM Research receives further information. A rating is typically put on hold for a period of 2 days to 4 weeks.

Not Rated

The fund has not been rated by SQM.