I agree with HP Boyle.

This article is the type that should be in one of the thousands of financial blogs by amateur s0-called investment experts, not on the CFA Institute's website.

Is there evidence that 20 - 30% turnover is low turnover? Shouldn't it be like 5 - 15%? A certain sage from Omaha said that a good investment is one that he will hold forever. So a turnover of 20 - 30% seems at odds with a high-conviction portfolio.

Students of investments were taught that, statistically, a reasonable number of securities for a diversified portfolio is a minimum of 30. Those with high-conviction (whether client or fund manager) may opt for fewer securities in their portfolios but this is not the whole universe of clients and fund managers. Having more securities does not mean one has lower conviction, it means that one targets a different risk-return objective.

As for tracking error, a large part of the cause lies in gatekeepers who advise the institutional investors that high tracking error could be a result of style drift. Tracking error is not the end in itself, it is the information ratio.