Active Manager Fidelity Says Active Management Good, Fire Good Too

Of course, there is a difference of opinion.
From MarketWatch:

This study shows stock-fund managers can beat an index 

The average index fund is expected to outperform the average actively managed fund with the same investment objective.

Why? Because both collectively make up the market in that asset class, and passively managed index funds have lower expenses.

The evidence at first seems overwhelming. The latest edition of a semiannual study that Standard & Poor’s publishes found that at least 78% of actively managed portfolios in 16 of 17 varieties of U.S. stock funds lagged their benchmark indexes during the 10 years through 2014. Similarly, a survey by Gerstein Fisher, an investment advisory firm, found that just 25.6% of actively managed domestic equity funds beat their benchmarks in the 15 years through June 2013.

But a recent study by a unit of the Fidelity fund family contradicts those and other observations of the supremacy of passive management.

The Fidelity study found significant long-term outperformance by active managers in segments of the stock market — international and smaller companies — often thought to give them the best chance of beating passively managed rivals. That’s because those asset classes are deemed less efficient in transmitting information to investors and therefore better able to be exploited by superior research.

During the 23 years through 2014, actively managed U.S. smaller-company funds beat their benchmarks by 1.11 percentage points a year, while index funds underperformed by 0.35 percentage points. Active international funds did better, too, beating benchmarks by 0.86 percentage points, while index funds trailed by 0.32 percentage points....MORE

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"Succinctly Speaking" with Kathleen Fulmer.

...[Applause as camera zooms in to Kathleen]

Kathleen Fulmer: Good evening and welcome to "Succinctly Speaking." I'm Kathleen Fulmer. My guests today include Tonto, Tarzan and Frankenstein. All right, Tarzan, let's start with you: Fire.

Tarzan: Fire good.

Kathleen Fulmer: Mm-hmm. Tonto?

Tonto: Fire good.

Kathleen Fulmer: All right. Frankenstein?

Frankenstein: [Growls] Fire bad!

Kathleen Fulmer: Okay, we have a difference of opinion, and I think that's what makes our forum work, the give and take. Don't you think? [Tarzan and Tonto nod. Frankenstein scowls at Kathleen] Okay, let's move on, shall we? Bread....