While I still believe that, over the longer term, persistency of alpha generation can be found (consider, nearly 75 per cent of the Lipper Fund Award trophy winners of 2014 were in the first or second quartile of their sectors for three-year performance at the end of 2017), over the first half of 2018 random selection would have favoured a passive option.
On the face of it the first six months of this year have been fairly nondescript for active funds in aggregate.
Fund flows and performance are in favour of passive.
However, I am expecting a much stronger relative performance from “Team Active” in the second half of the year.
Jake Moeller is head of Lipper UK & Ireland Research, Thomson Reuters