Active vs passive investing: The debate continues

Fund manager risk vs market concentration risk

Read some of the most thought-provoking and current insight available on passive and active investing below.

S&P Indices' SPIVA Scorecards: U.S. Year-End 2024 (S&P Dow Jones Indices)

How did U.S. active managers perform relative to the S&P 500 last year? 65% of them were behind the benchmark. But there is more to the story that meets the eye.

Taking Stock of Index Concentration in U.S. Large Cap Growth (Polen Capital)

Index concentration is often illustrated by the market value percentage represented by the top five or 10 holdings, and for good reason.

Decomposing Equity Returns: Earnings versus Multiple Expansion (Robeco)

Understanding the source of returns can help both active and passive managers grasp the equity landscape.

The Concentration Conundrum: What to Do about Market Dominance (GS)

Does it really matter for investors that markets have become more concentrated. And what, if anything, can they do about it?

The Case for Active Fixed Income (BNY)

Investors in fixed income must be aware of the limitations of traditional fixed income indices when following a passive investment strategy.

A New Paradigm in Active Equity (AQR)

Investors are understandably wary of rising concentration, which many assume is associated with higher market risk.

Active Investing? Don’t Overlook Value in the Age of AI (Vanguard)

For compliance reasons, this paper is only accessible in certain geographies

What is the key difference between an active asset manager and an active allocator? Read this article to find out.

Unlocking Alpha in Emerging Markets: Why Active Management Matters (PGIM Quant)

Emerging markets exhibit greater stock return variability compared to developed markets. Will this trend continue?

Active vs Passive Strategy and Market Outperformance: Are Hedge Funds Overrated?

This paper contributes to the active-versus-passive debate with a focus on hedge funds and their market outperformance.

2025 Active Management Environment (Verus)

Even without skilled selection, there are many cases in which active management may help investors achieve better portfolio outcomes in risk and return terms.

Are PE Fund Managers Just Long-Only Active Managers? (Edhec Scientific Infra)

Private equity fund managers are active managers who principally take on market risk while making active bets across various sectors, segments, and individual companies.

How Does Passive Investing Impact Market Risk? (Quantpedia)

Academics hypothesize and show that the popularity of passive investing can undo the benefits of diversification and lead to higher market-level volatility.

Is Bitcoin Enough? An Analysis of Passive Crypto Investments (PMR)

A Bitcoin-only investment can result in similar returns and often reduced volatility compared to passive strategies incorporating the largest altcoins.

Are Stock Investors in for Another Tech Wreck? (Morningstar Indexes)

Stocks belonging to the technology sector represented 32% of U.S. equity market value as of the end of 2024. Is the U.S. market too concentrated?