![]() ![]() Our findings, which found a one in two chance of picking an active fund that outperforms, paints fund manager as more skilled than other research has done in the past. Tracker funds are better in some markets and much cheaper, but there are certain fund managers who deliver superior returns and are worth paying a premium for.” “When I invest personally and for my clients, I use both. “It has become a religion to some investors, to the extent that they are not prepared to weigh up the other side of the argument and will only talk up the merits of one strategy and criticise the other,” she said. The figures are net of fund charges.įinancial advisers such as Philippa Gee, of Philippa Gee Wealth Management firm, said the data showed savers should not favour one strategy over the other and should instead hold a mixture of the two. Overall, 50pc of active funds beat tracker funds over the past decade. In last place were active US funds, only a third of which managed to beat the top tracker. Among Asia funds, 55pc of active portfolios beat the best tracker over a decade, while the figure for the UK was 52pc.įorty-eight per cent of global funds with human managers outperformed the best passive fund over 10 years, compared with 38pc of Japanese funds. This was especially true of funds that buy European shares, with 70pc of actively managed European funds beating the best European tracker over 10 years. ![]() Our analysis looked at “growth” funds, those that aim simply to increase in value over time, and did not include income funds.Īctive funds fared better relative to trackers over the longer time frames in the study. The six markets picked – the UK, US, Europe, Asia, Japan and global markets – are among the most popular with British investors. The graphic outlines the chances of an active fund manager beating the best-performing tracker of the relevant index over the past three, five and 10 years. Some of the results are surprising and conflict with previous academic studies which concluded that a monkey with a pin could do a better job picking shares than a highly paid fund manager. Three years ago tracker funds held £60bn of British savings, but this figure has now leapt to just shy of £100bn. The data, summarised in the graphic (see page 3), makes interesting reading at a time when investors are increasingly turning their backs on City stock-pickers and turning instead to tracker funds, which offer low-cost exposure to a particular stock market. The study, by Morningstar, the data firm, worked out how many funds run by a human stock-picker beat the best performing “tracker” funds in six regions over various time frames. ![]() New analysis has the answer A look back over 10 years reveals the markets where human fund managers are most likely to earn their keepīritish savers had a 50:50 chance of picking an “active” fund that managed to beat simple automated rivals over the past decade, research for Money Telegraph has established. ![]()
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