Do your active returns pass the age test?

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The five- and 10-year active return series relative to an appropriate benchmark is an investment industry standard.

But what lies beneath the numbers can be more telling than the numbers themselves. And there is one dimension that is frequently overlooked: how specific time periods within the series contribute to, or unfairly skew, the end results. For example, great 10-year numbers can lose their luster when it’s discovered they are being propped up by one or two uncharacteristically stellar periods early in the time series. After all, if most of the top returns occurred long ago, it’s only natural to question whether the manager can repeat that performance in the future.

So, what’s a manager to do?

Here’s one way to show asset owners and consultants what lies beneath your return distribution numbers:

Distribution of Active Share compared to <Index>


Click here to read more about how you can use the timing of your active returns in marketing and client communications.

We hope you find it helpful!

Read the full paper here

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