Mark Northway: Has the passives industry become its own worst enemy?

Debate must focus on value not cost

clock • 3 min read

The focus on cost in the passive industry creates damaging misconceptions, writes Mark Northway. Here he explains why price might win the battle, but value will win the war

A battle on fees, a war on price or a campaign against charges - whichever way it is framed, the debate about passive funds and price is often far more superficial than it deserves to be. The age-old debate rages on - active managers claim that stock picking expertise, which they suggest leads to outperformance, warrants higher charges; the passive world says it can deliver commensurate returns at a fraction of the cost.  But the passive industry may have become its own worst enemy in debating price on the investment battlefield, often using price as an overly simplistic differentiato...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Future of Investment Festival: Our specialist sessions for advisers

Future of Investment Festival: Our specialist sessions for advisers

Targeted at sustainable, forward-thinking finance professionals

Professional Adviser
clock 10 May 2024 • 1 min read
Defaqto: 'No appropriate and compliant way to compare MPS portfolios'

Defaqto: 'No appropriate and compliant way to compare MPS portfolios'

Tech firm to debut a performance comparator tracking solutions’ data

Hope Coumbe
clock 09 May 2024 • 1 min read
Assessing investment decisions made in the heat of the moment

Assessing investment decisions made in the heat of the moment

'Investors were panicking, thinking no one would ever go outside again'

Chris Justham
clock 08 May 2024 • 2 min read