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64% of managed funds fail to beat FTSE All Share

Almost two-thirds of actively managed investment funds failed to outperform the FTSE All Share index last year, according to a survey commissioned by Virgin Money.

The report by consultancy The WM Company found that 167 out of 260 active funds – 64 per cent – were beaten by the index before initial charges in 2001. In 2000, this figure stood at 48 per cent.

Virgin says the results show there is no evidence of consistent outperformance among active funds, despite claims that they tend to perform better in times of stockmarket difficulties.

It says that in three of the four years in which the stockmarket has recorded negative returns – 1990, 1994, 2000 and 2001 – the majority of managed funds failed to perform better.

But over the past 20 years Virgin claims more than 80 per cent of active funds failed to beat the index before initial charges.

It believes this is evidence that fund managers have timed their moves badly and failed to anticipate market falls.

Virgin spokesman Gordon Maw says: “This study shows that even when stockmarket conditions were supposedly more favourable for fund managers, the vast majority failed to beat the index.

“The picture over the past 20 years presents an even clearer case for the merits of index-tracking as 82 per cent of active funds failed to beat the stockmarket.”


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Appointments at Royal London

Royal London has announced the appointment of Chris Ide as chief executive of its retail operations. Ide joined the mutual in late 2000 and has been leading the provider&#39s push into new markets and methods of distribution.Before Royal London, Ide headed up Swiss Life&#39s European division based in Zurich. Prior to that he was Swiss […]

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Smile Invest – Ethical

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Show me the money – earnings are central to performance in Europe

Equity markets globally currently remain vulnerable to sharp shifts in sentiment caused by either unexpected or unwelcome outcomes in key upcoming political events (the US and German elections, Brexit and the Italian referendum). These top-down influences, combined with the current low global growth environment, will likely lead to broadly directionless markets, and prolong the current low beta return environment. We do, though, […]


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