Fund Pros Burned in AI Surge Are Giving Up on Active Management
- Active-share ratio drops to lowest in a decade, BofA data show
- Smallest pool of winning stocks in decades poses big challenge
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The never-ending rise in technology megacaps is driving stock-picking pros to do something they don’t want to do: give up on beating the benchmark.
With the likes of Microsoft Corp. and Nvidia Corp. all but owning 2023’s bull run, money managers faced a dilemma. So many stocks have been left in the dust that finding ones to beat the index is next to impossible — the hardest since 1987, by one measure. One remedy is to give up and let the S&P 500’s static allocations guide their own.