Active managers have 'window of opportunity' to outperform passives

According to new study

A new study published by Essentia Analytics has claimed that active fund managers could outperform passive index funds by more than net 1.2 percentage points.

The Alpha Lifecycle study has suggested that active fund managers have a "window of opportunity" in each position, which they can leverage to outperform index funds by more than 1.2 percentage points net of fees. It found that "on average" the alpha generation of a position "tends to rise steadily early in its lifecycle, then plateau, then fall dramatically". Know your biases: Don't catch a falling star However, an earlier published report found that managers tend to hold their positions "well past 'peak alpha'", instead selling out when they have "given up all of the position's ou...