Active management US outperformance ‘at lowest level in a decade'

Fewer than 20% of actively managed US large cap equity funds assessed by Bank of America Merrill Lynch (BofA ML) have outperformed their benchmarks so far this year, the lowest level in a decade.

Latest figures from the investment bank show last month’s market volatility dragged down average returns further after what had already been a poor 2014. Overweights to the likes of energy stocks, which suffered in October as the oil price continued to slide, meant that just 18% of active US managers were outperforming the Russell 1000 large cap index by the end of the month. That compares with 44% of funds outperforming the index last year, according to BofA ML. Analyst Savita Subramanian pointed to large-cap funds’ bias towards the smaller end of their market as being to blame, s...