The struggles of active managers over the past several years have been well documented. Plenty of folks appear on various financial media outlets year after year proclaiming “this is a stock picker's market.”
The thing is, stock-picking is difficult. Worse yet, data suggest there are not many great stock pickers out there. S&P Dow Jones data show 82 percent of active large-cap managers failed to beat the S&P 500 over the past decade.
Maybe in theory, active management should work more to investors' advantage with small caps. The reality is, active small-cap managers are actually worse at beating their benchmark than their large-cap counterparts. Over the same 10-year period, more than 87 percent of small-cap active managers lagged the S&P SmallCap 600 Index, according to S&P Dow Jones.
Investors searching for small-cap exposure can eschew the usual cap-weighted funds, while sticking with the advantages of passive management and the exchange traded funds wrapper. Ideas include the fundamentally-weighted WisdomTree SmallCap Earnings Fund (ETF) (NYSE: EES) and the ...
/www.benzinga.com/trading-ideas/long-ideas/15/08/5797284/staying-passive-with-small-cap-etfs alt=Staying Passive With Small-Cap ETFs>Full story available on Benzinga.com
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