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      For more than 55 years, Institutional Investor has delivered the news and analysis that investment professionals need to succeed and stay relevant. Our coverage of the global asset management industry helps you to stay ahead of the curve on the trends and stories that impact your world.

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      Paying it Forward: A Fidelity CIO’s Journey to Purposeful Philanthropy
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      Expert Perspectives: C-Suite Insights from II’s Exclusive Forums
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      Allocators and Asset Managers Tell Us What Concerns Them Most
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      Kasia Karapuda, Director of Investments, Oberlin College Investment Office
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      Kristin Agatone, Chief Investment Officer, Lehigh University
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      Michael W. Frerichs, Illinois State Treasurer, Illinois State Treasury
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      Expert Perspectives: C-Suite Insights from II’s Exclusive Forums
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      Why Small-Caps Could Outperform in the Next Economic Cycle

      Why Small-Caps Could Outperform in the Next Economic Cycle
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      Paying it Forward: A Fidelity CIO’s Journey to Purposeful Philanthropy
      While Inflation Grabs Headlines, Employment Numbers Drive Market Moves

      While Inflation Grabs Headlines, Employment Numbers Drive Market Moves
      Robeco Fundamental Equities: High-conviction Strategies to Target Alpha

      Robeco Fundamental Equities: High-conviction Strategies to Target Alpha
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      Trump 2.0 and the Markets

      Trump 2.0 and the Markets
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  • About Us
Paul Smith
A New Perspective on the Active–Passive Investing Debate
Active managers always outperform passive managers on a benchmark comparison. So why does nobody seem to care?
Paul Smith July 12, 2016
2016-07-uw-paul-smith-active-vs-passive-large.jpg

Here’s a fact that doesn’t get enough attention: By some counts, up to 86 percent of active funds underperform their benchmark, but by definition 100 percent of truly passive funds underperform theirs. Why is this? Because — unless they are taking some type of an

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