Zweig on Closet Indexing & Active Share

For many years, argues Jason Zweig in last month’s Wall Street Journal, “many fund managers haven’t done much managing at all.” Instead, he writes, they track market indices and “buy a bit more of this stock and a little less of that one, in what’s known as closet indexing.” The problem, however, is that active fund management clients are paying hefty fees for what amounts to passive management. “To call such chicken-hearted tweaks ‘active management’”… Read More

Closet Indexers Will Go the Way of the Buggy and the Whip

“The decade long run of money moving out of actively managed mutual funds in favor of passive indexes and exchange-traded products speaks volumes about investors’ palate for active management these days,” according to a recent article in Investment News. The piece touches on how to identify active managers who are not simply hugging the benchmark in an overly cautious effort not to get beat by it.  The key is to be selective, according to the… Read More