Within the investment industry, there is an ongoing debate on passive versus active investing. Vanguard has been one of the more vocal participants at evaluating active managers and the consequences of stock-based investment strategies. Our own research into the matter confirms Vanguard’s hypothesis. Most managers that claim themselves to be active are not consistently adding value on top of the market’s natural return. Each year, we hear that this will be the year that active management wins, yet that seldom comes true.
This begs the question as to why?
A majority of the investment community attempts to add