4/5/2023. Nope. Moreover, a DIY investor, holding one equity fund and one bond fund, would have outperformed, for equivalent volatility.
Benchmarking The Fund
Benchmarking Independently of the Peer-Group – The PIPS Benchmark
Choosing A Suitable PIPS Benchmark
Comparing The Rathbone Fund With An Investible PIPS Tracker
But here we see that an award-winning actively managed portfolio has delivered no enhancement compared to a simple passive index portfolio.
In terms of risk-return performance, the Rathbone fund is amongst the leaders in the sector. It just hasn't performed as well as a simple PIPS tracker with the same volatility.
- Managing a multi-asset portfolio is difficult. With great potential for more complexity than in the single-asset world, because managers have a huge universe of assets to choose from.
- Managers of multi-asset funds and discretionary portfolios generally compare themselves against the peer-group, because independent benchmarks are scarce. This ignores the risk that the peer-group itself is silently underperforming.
- This doesn’t need to be the case. Benchmarking using a independent passive index portfolio (PIPS) is a valid approach, and can help to keep focus on simplicity over complexity.