Tag Archives: Passive

Jan 4, 2021

Persistence

Lyndon Baines Johnson became President of the United States at a moment of national trauma, and left office at a time of tremendous political division. Despite a landslide electoral victory in 1964 and notable legislative achievements, his was not a happy presidency. LBJ observed, in fact, that “being President is like being a jackass in…

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Jul 1, 2020

Can Top-Performing Funds Stay on Top over Time?

Many market participants attempt to identify future top-performing funds using managers’ track records. This practice implicitly assumes that managers’ successful track records reflect skill and that their superior performance will be repeated in the future. Since genuine skill is likely to persist, one key measure of active management skill is the consistency of a fund’s…

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Jun 25, 2020

Making Sense of the Active Manager’s Conundrum

Why are the market environments most conducive to generating positive absolute returns the least conducive to producing positive relative returns? Explore the active manager’s conundrum with S&P DJI’s Craig Lazzara and Anu Ganti.

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Jun 22, 2020

The Progression of Passive

The evolution of indexing is one of the most noteworthy trends in modern financial history. The rise of passive investing is the consequence of shortfalls in active performance, as regular readers of our SPIVA reports will recognize. Our recent annual Survey of Indexed Assets shows a surge in S&P 500 indexed assets to $4.6 trillion…

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Apr 22, 2020

Is Volatility an Investor’s Friend or Enemy?

Explore how high volatility and high dispersion can impact passive and active managers’ performance with S&P DJI’s Craig Lazzara. Get the latest Dispersion, Volatility, & Correlation dashboard: https://spdji.com/documents/commentary/dashboard-dispersion-2020-03.pdf    

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Dec 2, 2019

Stock Pickers: Hope Springs Eternal

The Wall Street Journal recently quoted several active managers who claim that “conditions for stock picking are improving”. Their rationale is that declining correlations among stocks in the S&P 500 have made it easier for active managers to select stocks based on fundamental analysis. We have heard this argument before, most notably in 2014 when,…

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Jul 15, 2019

2019 Mid-Year Persistence Scorecard – Key Highlights

When it comes to investing, market participants often consider past performance to be indicative of future results.  The same goes for fund selection.  Notwithstanding the evidence showing that most active managers in most regions typically underperformed their benchmarks, consistently beating peers is one way to differentiate a manager’s luck from skill.  Here are a few…

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Jan 14, 2019

Raising the Bar in Small Caps

As a leading index provider with clients and customers around the world, S&P Dow Jones Indices regularly launches new indices.  Just like our children, we try to love them all equally.  Every now and then, however, a particularly exciting new index comes along.  Last week, our global equities group launched a potentially important new benchmark…

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Dec 11, 2018

Passive Investing Opportunities in India

Fifty years ago, there were no index funds—all assets were managed actively. The subsequent shift of assets from active to passive management in the U.S. and European markets could be considered one of the most important developments in modern financial history, and this shift was the consequence of active performance shortfalls.[1] In India, we have…

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May 16, 2018

Introducing the Persistence Scorecard for Latin America

Following similar studies performed by S&P Dow Jones Indices on active funds in the U.S. and Australia, we introduce the Persistence Scorecard to the Latin America region. The two aforementioned studies have demonstrated that top-performing active funds have little chance of repeating that success in subsequent years. To determine if similar conclusions can be made…

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