Return Of The Stockpickers

Ted

FYI: (Click On Article Title At Top Of Google Search)
When John Templeton said, “The time of maximum pessimism is the best time to buy,” he probably wasn’t thinking that his tenet might one day refer to his own industry. Yet, for active mutual fund managers, 2014 was a point of maximum pessimism.

While the Standard & Poor’s 500 returned 13.7% for the year, stockpickers struggled to keep up. Just 19.9% of U.S. equity fund managers bested their benchmarks, according to Morningstar -- but those who did managed an advantage of 1.8 percentage points, on average. Specialists, such as sector and alternative funds, also struggled, with 33% and 25%, respectively, beating their benchmarks.
Regards,
Ted
https://www.google.com/search?newwindow=1&site=&source=hp&q=return+of+the+stockpickers+barron's&oq=return+of+the+stockpickers+barron's&gs_l=hp.3...1522.13639.0.14304.35.28.0.7.7.0.79.1685.28.28.0.msedr...0...1c.1.60.hp..13.22.1022.caZSxDnDuDQ

Tampabay

"....... 19.9% of U.S. equity fund managers bested their benchmarks, according to Morningstar -- but those who did managed an advantage of 1.8 percentage points, on average"
those are my "people" make sure their yours....+1.8% is a lot of money for spending

Bitzer

" 'If rates falling were part of this backdrop [of underperformance], then active managers should get their lead back when rates move higher' says Mezrich, who used data from the University of Chicago’s Center for Research in Security Prices. "

I wish Mr. Mezrich would tell me when rates are going to rise (and stay higher) and tell me which active managers will outperform in that environment.

Tampabay

If He did that you wouldn't have anything to do (figure out), that's your Job, Its all readily available...good luck

Bitzer

@Tampabay Perhaps I'm missing the point, but I look for actionable advice. Comments like those of Mr. Mezrich are sufficiently vague so as be, in my opinion, essentially worthless. Few people actually know when rates will rise and which active funds will outperform.

What I've learned is to tune out most of these comments and invest in passive index funds.

JohnChisum

They have been talking about rates rising for how long now? The latest word is March for a rate hike but again it's all speculation and guesswork.

I am in the camp that if and when they do raise rates, it will be done very slowly and in tiny increments. Is there any reason they can't hike by ⅛ instead of ¼ point? There will be the usual knee jerk dump in the market and then everyone will realize that the world didn't end.

Tampabay

"Looking for love in all the wrong places" used to be an investment song.....I think,
I try not to worry much about interest rates, but I pay my bond managers to do so,
So far, there worth what I pay them....

ibartman

http://si.wsj.net/public/resources/images/ON-BH910_MFQCov_G_20150109220517.jpg

Check out link above. It refers to image/table from the Barron's article.

Anyone other than me find the benchmarking of [Vanguard Wellington] or [Amer Funds Balanced] against the S&P 500 (!) peculiar?

Tampabay

They are nuts or stupid or both....Wellington holds 35% bonds and a limited # of stocks for such big $ holdings...How could they outperform S&P in 2014?
Every wonder why guys like me and (ibartman) question most financial reporting, the readers (public) would assume that Wellington was a under performing fund....BS
Ridiculous stuff

Tampabay

Correct Benchmarking performance:
+/- Morningstar Moderate Target Risk Benchmark
-0.16 0.30 0.53 2.70 0.38 5.03 3.54 2.61 1.43 1.71

+/- Category (MA) Wellington
-0.01+ 0.15 0.14 1.27 0.16 3.65 2.25 1.90 2.05 2.59



Here Barrons: Wellington correct performance against Morningstar's moderate risk benchmark.....PLUS figures in EVERY time period
need more go to Morningstar forget Barrons
http://performance.morningstar.com/fund/performance-return.action?t=VWELX&region=usa&culture=en-US

Ted

@MFO Members: VWELX is 65% benchmarked to the S&P 500 and 35% to theBarclays U.S. Credit A or Better Bond Index thereafter.
Regards,
Ted