Over a 12-month-rolling period, only 23% of Europe managers and 25% of US managers as well as 24% of emerging markets managers outperformed their benchmarks net of fees. The underperformance of small caps in a declining market did hurt most managers as a majority had an overweight in this market cap cluster.
In January, the performance of active managers in the US was much more convincing. 58% of US-managers outperformed their respective indices net of fees. The picture in the emerging markets is with 52% a little bit weaker. In Europe, 43% of the managers could beat their indices net of fees. During the market recovery in January, small caps significantly outperformed large caps, especially in the US. In addition to that, growth performed better than value in the US, which was not the case in Europe. The majority of the US managers do have a growth rather than a value bias which contributed positively to relative performance as well. Finally, most US managers have a strong exposure to financials/industrials and both sectors showed very good results in January.
Please find the full fundinfo Research News - February 2019 edition including a summary of manager meetings attached on the left.