S&P Launches Indices vs. Active Funds Scorecard

Nov. 12, 2002 — Standard & Poor’s launched Standard & Poor’s Indices Versus Active Funds Scorecard (SPIVA) to provide an unbiased comparison of actively-managed funds versus their respective style indices.

The scorecard contains quarterly performance data for domestic equity mutual funds benchmarked against corresponding Standard & Poor’s indices, including the S&P 500 for large-cap funds, the S&P MidCap 400 for mid-cap funds, the S&P SmallCap 600 for small-cap funds, and the S&P SuperComposite 1500 for broad market comparisons.

Among the findings: More than 63% of all large-cap equity funds were unable to beat the S&P 500 benchmark over the last five years. As the market turned bearish, however, actively-managed large-cap funds fared relatively better, with 54% beating the index over the last three years.

The report also revealed that actively-managed funds did not tend to outperform the index benchmark in the small-cap arena. Measured against the S&P SmallCap 600, 67% of actively-managed small-cap funds over the five-year period, and 71% over three years, under-performed the index.