Is active management dead? By the end of 2025, the median active manager had posted the worst 3-year excess return in over twenty years. Yet outperformance has not disappeared everywhere. The Peer Group Success Score, as elaborated on in this article, points to wide differences across regions: in Japan, active management clearly adds value, and in Emerging Markets active choices are still rewarded, while in US Large Cap almost no approach worked, apart from low-tracking-error quant strategies. Market concentration, not manager skill, may be the real story of this cycle.
Those seeking to achieve outperformance in equities face a more challenging environment than ever before. The year 2024 marked a historic turning point: the median 3-year excess return of our overall peer group1 which represents active management strategies in developed and emerging equity markets, turned negative for the first time, indicating that the median active manager failed to generate outperformance. By the end of 2025, the situation had deteriorated further, with median 3-year excess
returns dropping to –0.55%, the worst reading in our measure as displayed in graph 1 further on in this article.
in VBA Journaal door Ilja van den Bosch