S&P’s SPIVA (index versus active) data now spans 15 years of data on the performance of Australian managed funds. This study illuminates returns from sectors and styles, and investment lessons learned from it.
Tag Archives | outperformance
Some global index calculations understate the performance of the portfolio, making it easier for fund managers to outperform. Investors should know this and manage the consequences.
Market performance and outperformance can come from many sources, but the main thing to watch for is that you’re not paying high ‘alpha’ fees simply to achieve market ‘beta’ returns.
The term ‘alpha’ may be financial jargon, but for fund managers, it’s the highly sought-after prize for successful active management that justifies fees charged. But how do you select a good manager?
In a continuation of the ‘active vs passive’ debate, there are many reasons why a good active manager should be worth the extra cost. What should the manager be doing to deliver results?
The empirical evidence in the active v passive investing debate favours index in most asset classes, but there’s a role for mixing the techniques if good managers can be identified – although that’s not easy.
The ability of active fund managers to produce outperformance is generally attributed to a unique skill set. However, there are proven contributors to performance which are persistent and systematic, not manager skill.