Fund managers are quick to purchase downside this year as the majority of fund managers play catch-up to the S&P 500. After a disastrous 2008 fund managers are desperately trying to avoid dreaded back to back negative relative returns. While hedge funds tend to catch a lot of flack for driving prices, it’s still the good old mutual fund managers that control the majority of the assets in the market.
Morningstar’s Large Cap Core index is up just 14% while the S&P pushes the brink of 19% YTD returns. If you’re curious who’s doing the performance chasing this year look no further than the thousands of mutual funds who failed to produce anything close to positive relative returns last year.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.