Date: 24th June 2019

Shortly after its release, the new research by BETTER FINANCE on the Correlation between Costs and Performance of EU Retail Equity Funds has been picked up by media outlets across  Europe. The study is based on a very large sample of funds  (1,970 active funds), with BETTER FINANCE covering equity funds domiciled in France, Luxembourg and Belgium. As quoted in Asset News, the findings in this research are “no good news for the 1,886 Ucits and AIF active equity funds”, as they demonstrate that only 27% of surviving funds with a sufficiently long track record managed to overperform the market over 5-year rolling quarterly periods. In addition to that, the study has confirmed a negative correlation between fund returns and fees, resulting in the priciest funds being the worst performing ones.

While BETTER FINANCE is planning to broaden its research’s scope by including Irish, German and UK funds, its managing director Guillaume Prache “doubt[s] it would change anything in its conclusions overall”.

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