Let's be real: chasing past performance is one of the most expensive mistakes in investing.
I've managed money through multiple cycles in Hong Kong, and here's what I've learned: even the best fund selectors with full teams and data can't consistently pick future winners. The academic evidence is clear on this.
Craig Lazzara from S&P's SPIVA scorecards nails it — long-term outperformers are incredibly rare. Even Berkshire has lagged the $SPY by ~2% annually since 2009.
This doesn't mean active management has no place. For concentrated positions in quality growth names with strong fundamentals, active makes sense. But for broad market exposure? The data speaks for itself.
My approach: core passive exposure for efficiency, selective active positions where I have conviction and edge. Position sizing and discipline matter more than picking the "hot fund."
If institutional investors with massive resources struggle to beat the index consistently, retail investors need to be even more honest about their edge — or lack thereof.
I've managed money through multiple cycles in Hong Kong, and here's what I've learned: even the best fund selectors with full teams and data can't consistently pick future winners. The academic evidence is clear on this.
Craig Lazzara from S&P's SPIVA scorecards nails it — long-term outperformers are incredibly rare. Even Berkshire has lagged the $SPY by ~2% annually since 2009.
This doesn't mean active management has no place. For concentrated positions in quality growth names with strong fundamentals, active makes sense. But for broad market exposure? The data speaks for itself.
My approach: core passive exposure for efficiency, selective active positions where I have conviction and edge. Position sizing and discipline matter more than picking the "hot fund."
If institutional investors with massive resources struggle to beat the index consistently, retail investors need to be even more honest about their edge — or lack thereof.