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Inside the Market of Stocks
Over the last five and ten years, less than twenty percent of large-cap managers beat their benchmark. Should we be surprised to see that eighty percent of these funds fail to deliver returns above the S&P 500? Let’s turn to the data. On average, 50.6% of stocks beat the market in any given year. This makes intuitive sense, half the stocks beat the index and half do worse. Over the last twenty-four years, the percentage of stocks beating the index got as high as 66.5% in 2001 and as low as 29% in 1998. This data begins in 1991 which is as far back as S&P member performance goes on Bloomberg. I suspect that the ... (full story)