Why Active and Passive Investment Are Not Mutually Exclusive

Last week, Bloomberg penned an article entitled Battered Funds Blame ETFs for Overrunning the Stock Market Again. The article (along with a subsequent Bloomberg sponsored podcast released around the same time) explores how passive investing could be blamed for the underperformance experienced by discretionary fundamental stock-picking managers. For anyone interested, the most recent SPIVA scorecard (as of…

Why You Should Expect Some Underperformance

Investment managers that employ trend-following strategies have had a challenging few years. Though not as significant as the underperformance realized by the value factor (relative to the growth factor), the last eighteen months of sideways, volatile price action in global equity markets has some pioneers of trend-following strategies questioning whether the strategy is still viable….

What to Do in Periods of Underperformance

Underperformance for investment managers is a tricky topic of discussion. When managers acknowledge a period of underperformance, it can be misconstrued by investors as accepting defeat. In reality, it is inevitable that every good investment strategy will experience a period of underperformance. Sticking with a strong investment strategy that is going through a period of…