Active Share Will Become Key Metric For Investors And Distributors: Credit Suisse

Active share will become an increasingly important metric for investors / distributors, which can advantageously be used to select which funds fit into the riskier allocation sleeves of portfolios / shelves, notes Credit Suisse

Craig Siegenthaler and team at Credit Suisse Equity Research in their June 3, 2015 research note “US Asset Managers” points out active managers will need to decide how they can evolve to compete against the advantages of the ETF structure versus open-end mutual funds.

Key role of active share

Tracking the genesis of active share, the Credit Suisse analysts point out that active share was introduced by the Yale School of Management in 2006 to measure the proportion of stock holdings in a fund’s composition that were...