How investors find the good funds

For as long as exchange-traded funds (ETFs) have existed, there has been a debate in the fund world about which funds are better: active or passive. Unfortunately, it’s true that the majority of fund managers fail to outperform their respective benchmarks. At Scope, we calculate each year for several groups of actively managed equity funds how many funds have outperformed the index. The result is sad: last year, only around a third of the fund managers managed to outperform the index of their peer group, i.e. to be better than the broad market average.