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Why Most Actively Managed Funds Underperform the Index

Beginner Investing • 6 min

Every year, S&P's SPIVA report shows the same result: most actively managed U.S. stock funds can't beat their benchmark index over 10+ year periods. This isn't just a one-off issue. It's a consistent pattern that’s been around for decades.Active funds typically have higher fees than passive index funds. Passive funds simply hold stocks in an index like the S&P 500 with little trading. Those higher fees need to be…

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