Active Management

“My answer is that indexation has taken over as it has, not because it's so good, but because active management was so bad.”

“The bad times create an opening for active management. But it's still hard, and not many people can do it well. Why do bad times create an opening? Because panic drives down, let's say, stock prices. But the same panic causes most people to panic, which means …”

“Where there's dispersion, you go active. Where there's low dispersion, like public equity, you go passive.”

“I basically think mega cap technology killed a lot of the active management world.”

“It becomes very difficult to beat The index because these companies are so very hard. It's hard to find companies that deliver a better return than they do. And I think that's where active management has struggled just because they are trying to beat a benchma…”

“I think what will benefit active management is that Concentration broadens. I'm a big believer that those seven companies will be successful only if the benefits broaden to the economy around the world, and so I would suspect that you're in an environment in t…”

“Investors hoping to beat the odds by playing the game of active management face daunting obstacles ranging from the efficiency and pricing of most marketable securities to the burden of extraordinary fees in most alternative asset investment vehicles. Success …”

“So there is absolutely a sense of time arbitrage in the markets. I think you see it in all markets. And as long as that's the case, I think longer dated, concentrated active management will always have a place. I don't see it going, even in the largest cap sto…”

“And what we found generally was that a lot of times the factors would swamp the good work that they were doing on the individual positions in the portfolio. So all this great analysis and research Being put into individual decisions, but macroeconomic effects …”

“I think these really counterproductive behaviors that largely explain why active management struggles, and it's a lot of group think. People are worried about standing out from the crowd. They're worried about careers. So they play it safe. They hug the benchm…”

“Passive investment is effective or efficient because it take all the active managers or the active investors opinion into their pricing. So the basically they are free riding all the other active investors. I'm not only talking about active portfolio manager, …”

“I'd specifically point out that I think active management is going to have a golden resurgence here in the coming years.”

“We've got two managers in New Zealand that run active equities. We've got one global emerging markets active manager, and that's it. Right. So we don't have any developed markets, active managers. We don't have any fixed income market active managers in those …”

“In aggregate of all the people going through the effort, is it worth it? No. Because we know that after fees, in aggregate, it's gonna be a negative return relative to the index, if you will.”

“In some ways, it may provide us even additional opportunity if you have less people actually pursuing active management. It could make the markets a little less efficient, if you will.”

“As you move out of the U.S. Into non-U.S. Equities, and the further afield you go into emerging markets and eventually into frontier markets, then the attractiveness of active versus passive becomes compellingly active.”

“Differentiated investment insights about the world will still matter, but you're going to need to invest in IT, and you're going to need to invest in science to augment that art, and so how do mid-sized companies continue to make those investments? I know they…”

“I think for institutional investors, there's a real need for actively managed portfolios because they have different needs, right? So they're not just trying to appreciate their assets. They have to be defensively posture. They have to be prepared for their ob…”

“So we're not really yet in a period where active management can really show its worth, but I think we're going to be getting there, and that's really going to get us more back to full circle, where active managers are going to come in. They can show that maybe…”

“So the industry basically has three years starting now to prove it can do it. If three years from now, we still have meeting an active manager below the ETF, the story will ride itself.”

“I think recently we introduced a emerging markets fund. It took us a little while to get the structure put into place because of some of the things that are unique in emerging markets and clearing. But that is an area that certainly we believe that active has …”

“So one of the ways to quantify that as we measure the standard deviation of excess returns, the standard deviation of alpha, right? So you imagine alpha plotted as a bell shaped distribution, which is roughly not a horrible way to look at it. And that bell has…”

“There are people who are for sellers. There are people who are forced buyers and they're doing things that are non-economic or for non-economic reasons. And those can present opportunities for the other side.”

“Active management today, there's more assets in active management today than there ever has been. So it's not that active management has gotten smaller. It's just gotten smaller as a percentage of the overall market.”

“One, active management isn't going away. So I think there will always be a portion of the market that wants to outperform and is willing to pay for the option around outperformance. So I think that's going to still be here.”

“With certain carefully identified exceptions, you, not only is it very difficult, you won't, and you almost can't, outperform the market after two big things. And it doesn't look big when you say it, only one percent. But if you say, wait a minute, seven perce…”

“I think alpha's never going to be as high on a repeatable basis as it probably was in 2000 or one, but we still believe in active management very much.”