The research is in, and everyone agrees: This is a great investing landscape for active management. Nearly half of all actively managed U.S. stock funds did better than a composite of index funds in the 12 months through June, according to Morningstar.
The reason? Stocks are moving less often in herds, a departure from the years following the Great Recession. A scattered performance gives stock-picking managers more opportunities to differentiate themselves from index funds.
The Standard & Poor’s 500 rose 15.5 percent in the year through June 30, but that masks some big differences in performance underneath. The best-performing sector of the 11 that make up the index, financials, jumped nearly 33 percent over that time. The worst, telecoms, lost nearly 16 percent. That gap of nearly 49 percentage points between the first- and last-place sectors compares with a gap of 28 percentage points at the end of last year.
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