Indexes Outperform Most Active Funds Through Third Quarter

Oct. 21, 2004 — Benchmark indices are outperforming actively managed funds in most U.S. equity styles year-to-date through September, and in the third quarter itself, according to research from Standard & Poor’s Indices Versus Active Funds Scorecard (SPIVA).

The data shows the S&P 500 Index is ahead of 62.6% of large-cap funds through the end of September, while the S&P MidCap 400 Index is in front of 57.7% of mid-cap funds, and the S&P SmallCap 600 is outpacing 84.4% of small-cap funds

For the third quarter of 2004, the S&P 500 outperformed 58.6% of large-cap funds, the S&P MidCap 400 Index outpaced 58.0% of mid-cap funds, and the S&P SmallCap 600 Index has beaten 69.5% of small-cap funds.

“A majority of active funds have underperformed benchmarks in this year’s trendless market,” notes Srikant Dash, Index Strategist at Standard & Poor’s. “Results of the first nine months of this year are in contrast to that of 2003, where a majority of active funds outperformed indices in six investment styles.”