Overview

Orion offers several additional features to supplement the assignment of classifications to products. This includes automatic classification assignments, automatically reassigning a Morningstar classification to a custom classification, and asset class and category weightings.

Automatic Product Classification

Use automatic classification to assign asset classes or risk categories to products based on their product type and selected scheme. Currently, Orion offers six different schemes to choose from. Below is a description of the most popular options.

Orion Subtype – Orion developed this scheme to provide an automatic classification option for situations where the other options do not offer classification. Orion Subtype mirrors the product subtype into its asset class and is most commonly used to classify Annuities, Bonds, CDs, and Options. If using this scheme at the asset class level, Equity is assigned as the asset category to all products with the following product types: Mutual Fund, Stock/ETF, Option, and Annuity. Money Market is assigned to Cash or Equivalent products, and Bond is assigned to all products with a CD or Bond product type.

Morningstar Sector, Group, and Industry – These three schemes are essentially the same; they just have different levels of granularity. They only classify stock products and classifications are based on the type of business the company does. Equity is assigned as the asset category by default to all products that are assigned to an asset class that uses one of these three options. 

Morningstar Style Box – This is Morningstar's equity-based classification scheme and is most commonly chosen to classify stocks. It classifies both stocks and funds and classifies equity into one of nine classifications: Small Core, Small Growth, Small Value, Mid Core, Mid Growth, Mid Value, Large Core, Large Growth, and Large Value. Since this scheme only considers equity for product classification, Equity is assigned as the asset category to all products when using this scheme at the asset class level. This can be misleading when used to classify fixed-income funds.

Morningstar Category – This scheme classifies funds based on the theme of their entire pool of investments. The classifications within this scheme use all three standard asset categories: Bond, Equity, and Money Market. It provides excellent coverage when classifying Mutual Funds, ETFs, and Closed-End Funds. However, the classification of Annuities is not always accurate because Morningstar does not classify subaccounts and Orion is unable to map them to the primary annuity account.


Review the Product Description Comparison view in the Products & Prices app or run Query ID 20142, "Products & Prices Asset Class Onboarding" when deciding if automatic classification works for your firm. The view and the query both provide a list of all products held by your firm and show how each available scheme would classify each product. They also display the current asset class and category that is assigned to each product for comparison.

Enable Auto-Assignment

• Navigate to the Products and Prices app .
• Under the Setup section, click Provider Assignments.
• Click the  next to Asset Class Providers or Risk Category Providers for any Product Type.
• Select the desired scheme from the Description Provider dropdown.
• Click Ok and then Save.

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Asset Class and Category Weightings

Each asset class can only be assigned to a single asset category in the Orion system. Asset class and asset category weightings are a great way to divide a single product, typically ETFs, Mutual Funds, and Closed-End Funds, into multiple asset classes or categories based on their holding allocations. For example, when products share the same asset class but should be assigned to different asset categories, use asset category weightings to override the category for certain products.

USE CASE: The Large Growth asset class is assigned to the Domestic Equity asset category in your database. Most of your products that fall into the Large Growth asset class also fall into the Domestic Equity asset category. However, you have a few products in the Large Growth asset class that should be assigned to the Foreign Equity asset category instead of Domestic Equity. To ensure that your products are classified accurately, add an asset category weighting of 100% Foreign Equity to these products. 

Establishing these provides a more accurate view of your client's exposures when running reports and viewing performance. Assign weightings manually at either level following the steps below, or Morningstar can automatically assign weightings at the asset category level as long as you have signed the Morningstar addendum.

Morningstar Category Allocation Weightings assigns and allocates up to eight asset categories: US Equity, Non-US Equity, US Bond, Non-US Bond, Preferred, Convertible, Cash, and Other. To enable this, select the Morningstar Category Allocation Weightings in the Provider Assignments section of the Products and Prices app. For additional instructions, reference the Enable Auto-Assignment section above. Once this is complete, the auto-assignment process needs to run for the changes to take effect. Before setting this up, review Query ID 10485, "Projected Morningstar Category Weightings" to preview the weightings that will be assigned to each product.



Manually Assign Weightings

Follow the instructions below to manually assign weightings to an individual product or en masse to multiple products.

Individual Product

• Navigate to the Products and Prices app .
• Locate the desired product in the My Current Products, Search Local Products, or Search Global Products tab.  
• Either double click or right-click and select Edit Product on the desired product.
• Click Product Weightings on the left.
• Select the first classification from the dropdown in either Asset Category Weightings or Asset Class Weightings section.
• Enter the desired percentage. (70 = 70%)
• Click Add New on the right for either Asset Category or Asset Class.
• Repeat the steps above until you enter all desired classifications and percentages. Percentages must total to 100%.
• Click Save in the upper right.

Import Weightings En Masse

• Navigate to the Products and Prices app  and click the My Current Products tab.
• Click Actions in the upper right and select Import Product Class Weightings or Import Product Category Weightings.
• Download the template in your desired format by clicking the corresponding button on the left.
• Fill out columns A, B, and C.
  • Product ID is the Product ID for the product you are assigning weights to. Use the same Product ID on multiple lines as needed to assign each classification weighting to the product.
  • Product Class ID is the number assigned to the asset category or asset class. The easiest way to look up Asset Class IDs is to go to the Asset Classes tab under the Exports section of the left sidebar and either view them in the grid or export them. To look up Asset Category IDs, go to the list of your Asset Categories through the Asset Classes/Categories tab and reference the ID column. 
  • Weight is the numerical value for the weight.  (70% = 70)
• Once you complete the template, save and close the document.
• Either drag and drop the document into the dashed box or click Browse Files and upload the file.
• Review all Validation Messages and update the spreadsheet accordingly.
• Click Process Import.
• Click Finished.

NOTE - Percentage must be greater than 0 for all asset class or asset category weights.

If you have questions or need assistance, please contact the SME Products and Prices team. 

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