Goodbye to Active Fund Management?
According to Bank of America, only 11% of large-cap active funds in the US outperformed their benchmarks for the decade as a whole. Equally, only 32% of stocks in the S&P500 index actually outperformed the index over the same period. This number was over 50% in the previous decade. Equally astounding is the fact that, according to a recent report, over 50% of US-domiciled assets are now managed passively; this number was 20% a decade ago. Will the next decade see these trends repeated, or will investors embrace active management again as fundamentals re-assert themselves and selective portfolios take back the advantage from index and factor strategies. We will explore the potential opportunities in the next decade and why active managers are well placed to exploit these trends.
Peter Toogood, CIO, The Embark Group
Better than bonds
For decades, bonds have been a reliable low-risk option for investors, generating good returns with low volatility. As their yields have collapsed, the impact has rippled through every asset class in the financial world. With over $13 trillion of bonds globally now trading at negative yields, where can investors turn to seek returns without increasing risk? Can we find options that are better than bonds? Starting with sovereigns, Orbis will walk through the spectrum of low-risk assets, highlighting the benefits and pitfalls of each one. Ultimately, investors in multi-asset funds may need to consider not just a different asset allocation, but a different perspective on asset allocation altogether.
Rob Perrone, Investment Counsellor, Orbis Investments