How active fund managers have fared against global indices


Posted by: Nicola Macdonald, on April 11, 2017.


Each year the S&P Dow Jones Indices release their S&P Indices Versus Active Funds (or SPIVA) Scorecard report. This looks at how active fund managers have fared against global indices.

Robin Powell of The Evidence Based Investor gives us his synopsis and a UK focused view on this report. Click image to read:

How active fund managers have fared against global indices

Aside from the poor results from the global active fund management industry in 2016 the SPIVA report highlights another interesting statistic. Assuming you are lucky enough to pick an active fund manager that provides top quartile performance, how long does that last?

SPIVA has found that of the 703 funds that fell into the top quartile performance (which does not necessarily mean they even matched the market rate of return, merely were in the top 25% of average active fund performance) only 146 remained top quartile in the following year, 49 after two years, 13 after three and just two after 4 years. This may imply top quartile performance in any one year is more down to luck than skill. This is clearly explained in the infographic How Many of the Best-Performing Active Managers Stay in the Top Quartile?, which you’ll find by clicking on the link and scrolling halfway down the page.

Swindells Financial Planning does not employ active funds when building portfolios for you with a focus on index investments and controlling the controllables such as costs of investment, infrequent trading and the correct risk profile for your goals.

If you would like Swindells Financial Planning to assist with your investments please complete the contact form or give us a call on 01825 76 33 66. We’d be delighted to help.



|

Enter your email

Get free investment, pensions and wealth management news and advice.

* indicates required

*We will never share your details with any third party.


Categories



Client Stories





Book a consultation


Your Name (required)

Email (required)

Phone Number

Age

Employment Status

Income

What you would like to talk about?

captcha

Enter exactly what you see above






Enter your email to receive free relevant news and updates.

* indicates required

*We will never share your details with any third party.


Latest… View all




More action less consultation please


The recent Financial Conduct Authority’s (FCA) long awaited final report into the asset management industry reinforced the evidence that we’ve known for some time; 1. Investments funds should compete on price, but clearly, they don’t, as the net profit margin of most asset management firms is still extraordinarily high (36%). 2. Paying a high price […]

Read more →


Hargreaves Lansdown v Vanguard (Who?)


Last month, Vanguard, announced that it is to offer UK investors a lower cost investment Platform, in a direct challenge to the incumbent behemoth Hargreaves Lansdown (HL). The immediate reaction was an 8% fall in the latter’s share price, as speculators pondered the demise of another Active-promoting financial services provider. Completely co-incidentally, the firm announced […]

Read more →


Do you really want to gift money to the taxman?


A recent survey* by Canada Life about inheritance tax (IHT) shows that wealthy Brits over the age of 45 are either ignoring estate planning solutions or they have forgotten about the benefits these can provide. Only 27% of those surveyed have taken financial advice on IHT planning despite all of them having a potential IHT […]

Read more →


Investment essentials


Back in August 2016, we encouraged you to watch a 12 part documentary featuring Robin Powell and Mark Hebner which included all of the key elements to become a better investor and less of a speculator. There is now an abridged and more succinct 16 minute version available (click on the image above) which still […]

Read more →