As benchmark-driven funds will not significantly outperform the stock market, so advisers need to stress the importance of active portfolios for investors able to accept greater risk
With inflation seemingly content to stay at historically low levels, it is natural to assume absolute returns from all financial assets will be lower going forward. And while we believe equities should continue to compensate investors with additional reward for the extra risk, a realistic long-run risk premium could be in the order of 2%-3% per year over bonds. At the same time, consumer influence over investment product development has never been greater. Perhaps one of the most fundamental challenges this brings is our industry's need to champion the concept of active fund managemen...
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