8 Stocks That Turned Losers Into Leaders (Update1)
BOSTON (TheStreet) -- Last year was particularly dismal for actively managed mutual funds. But many fund managers have turned it around in 2012.
S&P Indices said Monday that, by its analysis, 84% of actively managed U.S. equity mutual funds underperformed their S&P market-cap benchmark in 2011, a much worse performance than in previous years.
And prior periods weren't impressive either, as 56% of actively managed stock funds underperformed their benchmarks over the previous three years and 61% over the five years through 2011.
Specifically, S&P found that 69% of large-cap funds, 70% of mid-cap funds and 51% of small-cap funds failed to beat their respective S&P benchmarks over three and five years.
Not surprisingly, investors are voting with their feet and pulling money out of actively managed stock funds as they are clearly questioning the value of paying high fund-manager fees when an index fund or exchange traded fund can do better for less.