A Case Study on Vanguard Active Management

Executive summary. There is strong theoretical and practical evidence that most actively managed equity funds will underperform their benchmarks.To some, this makes the use of active management seem like a fool’s errand with little chance of long-term success. And yet many investors remain drawn to the prospects of outperforming a benchmark with active management.

Outperforming with active managers is challenging Over the past 20 years, less than 25% of actively managed U.S. equity mutual funds outperformed their relevant style benchmarks. Additionally, research has shown that the under performance of actively managed funds is relatively consistent across various countries, market segments, and time periods. Click here to read more…

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