Why does active management matter?
Our active portfolio managers leave no stone unturned to build investment portfolios that look nothing like the index.
Our active portfolio managers leave no stone unturned to build investment portfolios that look nothing like the index.
Truly active management offers:
A definable method for growing wealth
Real value to investors for the fees they are charged
Investor-specific solutions, not just products
Protection for investors from the mistakes of the herd
How you can benefit from active management
Stronger performance
Active stock pickers outperformed their benchmark indices even after fees, whereas closet indexers underperformed. Research by Financial Analysts Journal shows that managers with high active share had a net return of 1.3%, outperforming their low active share counterparts by 2.2% annually, as illustrated. The same research shows that high active share managers outperformed their respective indices by 1.35% during the same time period, after fees.
Fund performance from 1990 to 2009
Source: Financial Analysts Journal Volume 69 · Number 4: "Active Share and Mutual Fund Performance", Antti Petajisto, 2013 CFA Institute.
Truly active managers
Truly active managers represent less than half of the assets globally. Closet indexing means that investors are paying for active management while getting less than their fair share of market returns—and it’s a problem in Canada. According to a global study of the mutual fund industry, more than one-third of Canadian assets under management (37%) are held in closet index funds (funds with an active share below 60% yet claiming to be actively managed). Rather than mirroring the benchmark, active managers aim to help deliver benchmark- beating performance.
Source: Indexing and Active Fund Management: International Evidence*. Martin Cremers et al.; January 2015.
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