Why (Odd) Active Bond Managers Outperform More Often Than Active Equity Managers

Bonds are very different from stocks, particularly when it comes to active management and it does not only have to do with odd personalities.... Active bond managers outperform their passive peers, a PIMCO Quantitative Research report noted. There are reasons for the divergence, the report noted, as well as reasons for concern regarding the passive takeover of investment markets.

Active bond managers outperform their passive alternatives

On a ten-year basis, actively managed bond funds outperformed their passive investment ETF peers, the PIMCO study shows.

It was short and intermediate bond funds that outperformed their passive ETF investment competition most consistently. Short term bond funds outperformed their passive alternatives 80% of the...