While fund managers often say they add value for investors in smaller, lesser known markets because those markets are inefficient, The Wall Street Journal’s Jason Zweig says the data shows otherwise.

“If it were true that money managers can more easily beat inefficient than efficient markets, then the differences would be easy to see,” Zweig writes on “Total Return”, the Journal’s personal finance blog. “But that’s not the case.”

Citing Standard & Poor’s data, Zweig says that “over the three years ended in mid-2011 (the most recent data available), 64% of large U.S. stock funds failed to beat the S&P 500, according to S&P. Among small-stock funds, 63% lagged S&P’s index of small stocks, while 66% of real-estate funds underperformed their relevant benchmark and 81% of emerging-markets funds lagged the index of stocks in developing countries. Over five years, those gaps get even worse.” In other words, managers in those supposedly inefficient markets as a group did just about the same or worse than managers who focused on widely followed areas of the market that are supposed to be more efficient.

Zweig also points to commentary from Dartmouth Professor Kenneth French. Answering a question about efficient markets on a site hosted by Dimensional Fund Advisors, French says that it seems “implausible today” that certain areas of markets are inefficient because of neglect, “given modern technology and the hundreds of billions of dollars investors spend each year trying to find pricing errors.”