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Trending: Top Three Emerging Markets Equity Funds
Daniel Cross
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These funds specifically invest in emerging market economies with the largest being China...
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Now, thanks to a recent study by Jeffrey Ptak, Morningstar’s director of global manager research, we possess further evidence that the likelihood of generating alpha not only has been declining, it’s collapsing. Consider the following.
In his new study, presented in the February/March 2016 issue of Morningstar magazine, Ptak set out to determine how many U.S. equity funds went on to beat their relevant index fund benchmark on an after-tax basis over the 10-year period ending October 2015.
Ptak, who assumes that the investor sells at the end of the period, found that out of the 4,993 funds he studied, only 205 beat their benchmark index fund on an after-tax basis. That’s just 4.1%. On a relative basis, 70% fewer funds outperformed on an after-tax basis than Arnott, Berkin and Ye found to be the case in their study, done just 15 years earlier. And what’s more, 10% fewer did so on an absolute basis.
Ptak also found that it didn’t matter which asset class he looked at; only a very small percentage of active funds outperformed on an after-tax basis. Keep this in mind the next time you hear arguments about active management outperforming in supposedly inefficient asset classes (such as small-cap stocks).
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News
Daniel Cross
|
These funds specifically invest in emerging market economies with the largest being China...
Jayden Sangha
|
In this article, we will take a closer look at the upcoming initiatives...
Kristan Wojnar, RCC™
|
This week we are tackling the practice management topics of a client-centric approach,...
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Mutual Fund Education
Justin Kuepper
|
Let's take a closer look at how ESG investments have outperformed during the...
Mutual Fund Education
Daniel Cross
|
While CITs and mutual funds share many similarities, there are some key differences...
Mutual Fund Education
Sam Bourgi
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The phrase ‘bear market’ has been thrown around a lot lately, but it...
Now, thanks to a recent study by Jeffrey Ptak, Morningstar’s director of global manager research, we possess further evidence that the likelihood of generating alpha not only has been declining, it’s collapsing. Consider the following.
In his new study, presented in the February/March 2016 issue of Morningstar magazine, Ptak set out to determine how many U.S. equity funds went on to beat their relevant index fund benchmark on an after-tax basis over the 10-year period ending October 2015.
Ptak, who assumes that the investor sells at the end of the period, found that out of the 4,993 funds he studied, only 205 beat their benchmark index fund on an after-tax basis. That’s just 4.1%. On a relative basis, 70% fewer funds outperformed on an after-tax basis than Arnott, Berkin and Ye found to be the case in their study, done just 15 years earlier. And what’s more, 10% fewer did so on an absolute basis.
Ptak also found that it didn’t matter which asset class he looked at; only a very small percentage of active funds outperformed on an after-tax basis. Keep this in mind the next time you hear arguments about active management outperforming in supposedly inefficient asset classes (such as small-cap stocks).
Receive email updates about best performers, news, CE accredited webcasts and more.
News
Daniel Cross
|
These funds specifically invest in emerging market economies with the largest being China...
Jayden Sangha
|
In this article, we will take a closer look at the upcoming initiatives...
Kristan Wojnar, RCC™
|
This week we are tackling the practice management topics of a client-centric approach,...
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Download our free report
Find out why $30 trillon is invested in mutual funds.
Mutual Fund Education
Justin Kuepper
|
Let's take a closer look at how ESG investments have outperformed during the...
Mutual Fund Education
Daniel Cross
|
While CITs and mutual funds share many similarities, there are some key differences...
Mutual Fund Education
Sam Bourgi
|
The phrase ‘bear market’ has been thrown around a lot lately, but it...