šŸ¤” Are active and passive studies distorted only by closet trackers?

13 January 2021

In addition to what John Ions, Liontrust chief said in the FT article, I add that there are a number of unanswered questions in the market that do not allow the active vs passive fund performance comparisons to be fair:

1. Do all active funds officially follow the benchmark with which they are compared?
2. How do active funds perform vs ETFs and not vs benchmarks?
3. How do active funds perform during all their lifetime?
4. Does ā€˜the % of active fund outperformingā€™, the indicator that the market is looking at, encompass all the information available in the market to make the most efficient active-passive allocation decision?

šŸ‘‰ Relying on studies that do not answer those key questions can lead to erroneous active-passive allocation decisions. šŸ’”A close look at reliable and exhaustive data and indicators allow to have a fair view on the active-passive debate and to take efficient allocation decision for outperforming investments.
Follow me on my LinkedIn profile to discover the answers to those questions and more on the topic. šŸ‘€

Marlene Hassine Konqui