RIP benchmarking; all hail allocation
The overabundance of indices will put an end to the industry’s obsession with beating benchmarks and give allocation its place in the sun, according to Alliance Bernstein.
Active Versus Passive
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PA ANALYSIS: Is it wrong to dismiss the Vanguard revolution?
The American asset manager has been at the forefront of the passives craze globally. So, why are UK investors so reluctant to recognise its disruptive potential?
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Active UK equity posts strong 12 months
According to the latest bi-annual S&P Indices Versus Active Funds (SPIVA) Europe Scorecard, active funds investing in the UK produced an average asset-weighted return of 24.2% from mid-2016 to mid-2017, compared with a 17.6% return for the corresponding S&P United Kingdom BMI benchmark.
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Alpha Financial Markets Consultancy, Aim, Aim Listing, Consultants’
Active funds investing in UK equities enjoyed strong 12 months, with 80% of sterling denominated funds outperforming benchmark.
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Research questions long-term performance of tracker funds
With the exception of funds tracking the US and UK mid caps, no passive funds have been able to generate first or second quartile performance in their respective sectors over the past 10 years, according to research from Chase de Vere.
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PA ANALYSIS: What has inspired the active fund renaissance?
It was a bad time to be an active manager in 2016, the year of Brexit and Trump, with underperformance plaguing funds as passives tracked the market higher and higher.
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BMO GAM: Top active managers trounce passives over 10 years
Research from BMO Global Asset Management’s multi-manager team, headed by Rob Burdett and Gary Potter, shows that the cream of the active management crop have outperformed the top passive funds over the long term.
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PA ANALYSIS: Active managers ‘cannibalising’ themselves to survive passive resurgence
Passive rivals have forced active managers to focus more on fees than ever before. But are active managers biting off more than they can chew by getting into smart beta?
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Fund industry profits shrink as higher costs and passives bite
Worldwide profits for traditional mutual fund groups fell by close to 3% in 2016, despite higher assets under management, according to a report by McKinsey.
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Coombs: Passives are ‘blunt’ tools in post-Brexit reality
David Coombs, head of head of multi-asset investments at Rathbones believes passive funds may be inadequate to overcome the challenges arising in the new political climate.
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Toogood: Fund managers need a post-RDR reality check
Asset managers should take a page from the book of IFAs, and focus more on outcomes for their clients than one-upping competitors, according to The Adviser Centre’s Peter Toogood.
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PA ANALYSIS: Is passive beating active at its own corporate governance game?
It is no secret the evidence suggests the average active fund manager struggles to outperform consistently.