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05 Apr 2019

New Active Passive Report 2019

At Lyxor, we believe the combination of active and passive investments can be key to generating better returns. Every year, we take a deep dive into the performance of active funds vs. their benchmarks. This year, our research covers 32 active investment universes, just under 7,000 funds and EUR1.6trn of asset under management.


2018 was a very difficult year for active managers. In fact, it was one of their worst over a decade. High level of political and economic uncertainties, declines for nearly all asset classes and uncertain path for interest rates all weighed on their performances. 24% of active managers outperformed their benchmark over the year, well below the 2017 figure of 48% and below the ten-year yearly average of 36%.


Five things to know from this year’s study

  1. One of the worst years for active managers in over a decade
  2. Harder than ever to select an outperforming fund
  3. Only 27% of equity managers outperformed
  4. Fixed income managers did even worse
  5. The right blend of active and passive could have helped portfolios do better

This research is designed to help investors optimise their portfolios by choosing the right investment vehicles for each asset class. Our research results lead us to propose what we think is an optimal strategic neutral allocation between these investment styles. They also allow us to add ranges within which the size of each style allocation could vary - tactical allocation decisions effectively. These decisions will depend more on the expectations of the alpha generation abilities of active managers as a function of market conditions, together with the ability to select the appropriate funds among either traditional or alternative managers.