Saturday, September 27, 2014

Active vs. Passive in Global Investing | Financial Planning

Active vs. Passive in Global Investing | Financial Planning:

"The S&P Report, called the SPIVA U.S. Scorecard, which also evaluated the performance of active vs. passive management for domestic funds and for bonds, found that in the international sphere over the past year 70% of global equity funds, 75% of international equity funds, 81% of international small-cap funds and 65% of emerging markets funds underperformed their benchmarks.
As a group, active managers fared even worse over a three- or five-year period, says Todd Rosenbluth, S&P’s director of ETF and mutual fund research."

and more from Bloomberg:

"...making a fund manager into a star is a big risk. If the headline act has a bad year, the media notices. And if the star leaves, they can take assets with them, as bond baron Jeffrey Gundlach did when he left TCW Group and co-founded DoubleLine Capital LP. Up to 30 percent of Pimco's assets could now leave the firm, Sanford Bernstein estimates. After this, "funds may think twice about building the brand around a single individual," adviser Harold Evensky says.The biggest firms, like Blackrock Inc. and Fidelity, now mostly do without big fund manager stars. That helps put the emphasis where it belongs -- on performance."

'via Blog this'

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