This is an absolutely fascinating paper. The takeaways are huge. It explains why most active managers are playing from behind all the time. It also means that they need to make changes. Fast.

Probably makes the Bogleheads out there happy. This research shows that the average fund is charging active fees for only one-half an active portfolio. Or alternately, that the 'effective' active portion has a fee hurdle of 2x before it can generate net return for clients. Using Alexey's data, that is roughly 170bp. Tough hill to climb.

However, if this research ends up being the bread trail that allows active managers to get their house in order, then this research might end up being the key inflection point they need.

Thank you for the thought provoking study. When can we expect more revelations from your database??