As the final days of 2015 wind down, it’s time to think about performance.
Whether managers beat, tie or miss their benchmark becomes the focus. Many managers use these results to show their performance not just against the markets, but against their peers.
It illustrates how their investment process stacks up against the competition.
Beating the benchmark is no easy task. It is an extremely long season with twists and turns that very few can predict correctly.
Perhaps that is why 86% of active large cap managers failed to beat their benchmark in 2014.
To me this time of the year always reminds me of the feeling in September.
This is when the baseball season is beginning to wind down.
The season is long and filled with injuries, trades and players being called up or sent down to the minors.
At this point we have passed the point of the playoffs and the semi-finals. We are in the championship round.
For some managers, they never made the playoffs. For others they earned the right to say they got in the playoffs, but got knocked out early.
Going the Distance
For the rest, they are in the championship going head-to-head with the benchmark. Some have had such a great year that the final round is just a formality.
For others they are in the fight for their life. They have their best players on the field. Many are playing hurt or just plain worn out from the long season.
The year is long and grueling. The best managers get blindsided by scenarios that are completely outside of their control.
In the end only a small number of managers get the right to make it into the finals and can say they beat their benchmark.