Latin America is Hot - Don't get Burned
The SPIVA Latin America Year-End 2016 Results are out. The report does not make great reading for investors who allocate to Latin America via Active funds.
The SPIVA report makes this damning statement:
"the majority of active fund managers in Latin American markets were unable to outperform their respective benchmarks for all categories measured—one-, three-, and five-year periods."
The report goes on to state that:
"For all categories, the majority of managers underperformed their benchmark for a five-year time horizon, regardless of the report end date. “Consistent under performance” is a suitable characterization."
Active managers can and do out perform. Yet in aggregate they fail; finding that small number of managers in advance that go on to outperform down to luck not science.
Evidence-Based Investing makes a lot of sense, you are dealing with statistical probabilities and basic arithmetic rather than predictions. If want to know more about Evidence-Based investing as an alternative to conventional Active please contact us
You can read the full report here