Introducing a New Index Versus Active Funds Scorecard for Australia Standard & Poor's Index versus Active Funds Scorecard, Mid-Year 2009

Abstract

The S&P Index versus Active Funds (SPIVA) Scorecard reports performance of actively managed Australian managed funds corrected for survivorship bias and shows equal - and asset-weighted peer averages. Over a five year horizon, benchmarks have outperformed a majority of actively managed funds across equity and bond fund categories. Shorter horizon results are mixed. The S&P/ASX 200 index has outperformed two-thirds of active Australian general equity funds over the last 5 years. Year-to-date, the S&P/ASX 200 has only outperformed about half of active funds. The S&P/ASX Small Ordinaries index has out-performed just over half of the active Australian small-cap funds in the last five years. Year-to-date, the index has outperformed 60% of the actively managed small cap funds. The UBS Composite 0 Y Bond Index has outperformed 97.22% of actively managed bond funds in the last five years. However, in first six months of 2009, the index has outperformed only 25.81% of actively managed bond funds. Over a five year horizon, approximately 10% to 30% of funds have disappeared. This makes it important to consider survivorship in industry analysis. Equal-weighted returns over five years are lower than assetweighted returns for Australian general equity funds, but higher for Australian small cap funds. This suggests that funds with bigger assets have performed better, on average, in the large cap space, while funds with smaller assets have done better in the small cap space.