U.S. Active/Passive

Author

The Idea Farm
November 19, 2023

Together With

“Alpha is uncertain. Fees are certain.”

Bob Elliott

Research

Morningstar’s semi-annual report measures the performance of active funds against passive peers in their respective Morningstar Categories. spanning 8,212 funds that account for ~$17 trillion in assets (55.9% of the U.S. fund market). Some key takeaways:

  • 57% of active strategies survived and beat their average passive counterpart over the 12 months through June 2023, above their 43% success rate in calendar-year 2022.

  • More than 63% of active strategies that invest in stocks outside the United States beat their average passive peer, an increase of 30 percentage points over calendar-year 2022.

  • More than 55% of active bond managers survived and beat the passive average, up from 30% in 2022.

Facts & Figures

“According to a report by the All-China Federation of Industry and Commerce, more than 80% of China's 1 billion private enterprises are family-owned…” Source: Nikkei Asia

"More French people own crypto (9%) than stocks (7%) or ETFs (2%)." Source: Bloomberg

As of this fall, ~900 school districts (~7% of all districts in the US) now have four day school weeks. Source: Planet Money

Small-caps are trading at their lowest level vs. the S&P 500 (total return) in almost 23 years. Link

Source: Ned Davis Research. As of November 9, 2023

Goldman Sachs showing very few borrowers have a mortgage rate above the current mortgage rate.

As of November 7, 2023

Apollo on asset price bubbles since 1970.

Over the past 15 years, money invested in the benchmark US index increasing fivefold versus less than a doubling in Europe. Link

As of November 3, 2023

SPONSORED BY THE CAMBRIA SHAREHOLDER YIELD ETF (SYLD)
LOOK BEYOND JUST DIVIDENDS

Healthy, thriving businesses often have something in common: lots of cash flow.

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Smart managers can often buy back stock or pay off debt. These two options, along with dividends, create the trio known as shareholder yield.

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Distributed by ALPS Distributors, Inc. Investing involves risk, including possible loss of capital. To determine if this Fund is an appropriate investment for you, carefully consider the Fund's investment objectives, risk factors, charges and expense before investing. This and other information can be found in the Fund's full or summary prospectus which may be obtained by calling 855-383-4636 (ETF INFO) or visiting our website at www.cambriafunds.com. Read the prospectus carefully before investing or sending money.

Podcasts

10/11/23 - 33 minutes

Marks discusses his recent note, which follows up on his 2022 note titled “Sea Change.” He argues that the trends he highlighted in the original memo collectively represent a sweeping alteration of the investment environment that calls for significant capital reallocation.

10/11/23 - 234 minutes

Jared Kushner, former Senior Advisor to President Donald Trump, shares his views on state of geopolitics.

10/25/2023 - 32 minutes

PIMCO CIO Dan Ivascyn shares his thoughts on the current state of the economy, rising yields, the future path of inflation, and more.

WHAT ELSE IS HAPPENING

Meb Faber spoke with Jim Bianco about the macro environment and the end of the 40-year bond bull market.

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