Stock Rotation Deflated These Momentum-Heavy Funds morningstar.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from morningstar.com Daily Mail and Mail on Sunday newspapers.
For the first time, Ariel is moving into exchange-traded funds, which have been squeezing fee income collected by traditional money managers like Ariel. Ariel also recently disclosed novel plans to make direct investments in other companies under a program designed to create minority-owned firms and expand others. And a new office in San Francisco, its third, aims to corral tech and other West Coast wealth.
Hobson s expanding influence marks a turning point for Ariel, a leading Black-owned firm in Chicago. Founded by Rogers in 1983, it s also one of the city s few significant mutual fund companies. They ve tossed around the term Ariel 2.0, Morningstar analyst Adam Sabban says of the thrust.
It s been difficult for actively managed U.S. and international-equity funds to beat their benchmarks. According to Morningstar s Active/Passive Barometer, only 48% of active U.S. stock funds survived and outperformed their average passive peer over the 12-month period ended June 2019, and only 23% of all active funds beat their passive benchmark over a 10-year period. As Morningstar director of global ETF research Ben Johnson notes in the report, foreign-stock and bond funds tend to have higher long-term success rates, while U.S. large-cap funds report the lowest success rates.
To identify funds that not only beat their benchmark but hit it out of the park, we looked for U.S. and international-equity funds that outperformed their benchmarks over the five- and 10-year periods ended in December 2020. Funds had to have a 10-year history and current assets under management of at least $100 million.