2025-12-24 06:23:28

Active fund managers have indeed had a tough couple of years. According to the latest data, investors are expected to withdraw $605 billion from global active equity funds this year, breaking the previous record of $450 billion. More painfully, this marks the 10th time in the past 11 years that there has been an annual net outflow of funds. Cumulatively, the outflow of funds from active equity funds over these 11 years has reached $3.1 trillion.

Looking at performance, only 29% of large mutual funds have outperformed the market benchmark index so far this year, the lowest since 2019. Compared to the average level of 37% since 2007, the gap is significant. The data reflects a reality— the wave of passive investing is swallowing traditional active management models. Fund managers once attracted capital through excess returns, but now it is becoming increasingly difficult to prove their value.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

15 Likes

Reward
15
8
Repost
Share

Comment

0/400

FunGibleTom

· 12-24 21:47

Basically, active management completely failed, and it's better to just buy an index fund and relax.

View OriginalReply0

mev_me_maybe

· 12-24 06:53

Active funds are already dead; they should have been moved to the museum long ago.

View OriginalReply0

SignatureAnxiety

· 12-24 06:50

Passive investing crushes active management; this wave is indeed unstoppable. 3.1 trillion dollars have fled, and fund managers' good days are truly over.

View OriginalReply0

DegenDreamer

· 12-24 06:44

Passive index funds are really winning big; active fund managers should consider changing careers, haha.

View OriginalReply0

GasFeeCrier

· 12-24 06:36

Passive investing has already won; active funds are still struggling to keep up.

View OriginalReply0

ContractFreelancer

· 12-24 06:32

Passive index funds are almost wiping out active fund managers; the 3.1 trillion outflow is truly astonishing.

View OriginalReply0

GasFeePhobia

· 12-24 06:25

Ha, $3.1 trillion outflow, fund managers really should reflect on this, unreliable indeed. Passive investing is really the ultimate killer of active management, which is a bit outrageous. 29% outperform the index, this data is indeed disappointing, might as well buy index funds and relax. Can I be honest? Active funds charge higher fees, yet they still can't beat the market. Why are people still investing? In 11 years, 10 net outflows, this is clearly telling you the answer.

View OriginalReply0

TestnetScholar

· 12-24 06:24

Passive index funds are really winning big, while active fund managers are still trying to chase excess returns. In the end, everyone has already left. --- $3.1 trillion has flowed out. Isn't this the market voting with its feet? Still trying to attract people with stories. --- 29% outperformance against the benchmark? That data looks really uncomfortable. No wonder everyone is buying ETFs. --- The era of active management is truly over. Saving money and hassle-free, index funds are the way to go. --- Ten consecutive net outflows in ten years. This is a bloody lesson telling everyone that "timing the market is less effective than choosing the right fund." --- Wait, isn't there any fund manager who can keep investors with real skills? Why are they all losing together? --- Basically, active funds charge high fees, and index funds are better. The market's choice is very wise. --- $3.1 trillion has flowed out, which must scare the hell out of many fund company executives. --- It might just be the big environmental protection trend; even active funds can't beat the market, so they can only choose passive funds.

View OriginalReply0