Active managers failed to shine as equities tumbled last month

Active managers failed to shine as equities tumbled last month
Growth managers did the worst, while value managers managed a better showing.
NOV 02, 2018

Stock pickers have been promising for years that once the equity market hit a rough patch, they would have a chance to prove their worth. Maybe not. Stocks had their worst month in seven years in October and less than half, or 42%, of actively managed mutual funds that buy large-cap U.S. equities beat the S&P 500 Index, according to data compiled by Bloomberg. Growth managers — who tend to own some of the most popular technology companies — fared the worst, with only 13% beating the benchmark for the month. Shares of tech stocks took a drubbing during the month. Value managers did better, with 67% outperforming. They typically invest in financial and health-care stocks. The numbers were based on results from 682 funds tracked by Bloomberg. Early results suggest it wasn't a great month for equity hedge funds either. According to a report Tuesday from Morgan Stanley, U.S. equity hedge funds lost 7.2% for the month. That compares to a decline of 6.8% for the S&P 500, including dividends. https://cdn-res.keymedia.com/investmentnews/uploads/assets/graphics src="/wp-content/uploads2018/11/CI117718112.PNG"

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