UK and Australian Active Fund Manager Performance

The poor investment performance of actively managed mutual funds in Canada and the US is becoming a reasonably well-known fact, with mainstream media increasingly picking up the message. Less well-known is that the same phenomenon exists in the UK. A 2000 study in 2000 by Garrett Quigley and Ray Sinquefield "Performance of UK equity unit trusts" shows the same disappointing results as in North America.

Some choice quotes:
"UK money managers are unable to outperform markets in any meaningful sense, that is, once we take into account their exposure to market, value and size risk."

"Does performance persist? Yes, but only poor performance. As others find for US mutual funds, so we find in the UK. Losers repeat, winners do not."

There is no exception to this trend in Australia either as this Abstract of a journal article by David R. Gallagher and Elvis Jarnecic titled " International equity funds, performance, and investor flows: Australian evidence" confirms: "... active management does not provide investors with superior returns to passive indices."