Are you tired of seeing the same “Magnificent Seven” tech stocks dominate the market, causing headaches for mutual fund managers trying to diversify their portfolios? At Extreme Investor Network, we understand the challenges that come with navigating the current market landscape and we’re here to help you stay ahead of the curve.
The dominance of Amazon, Microsoft, Meta, Alphabet, Apple, Nvidia, and Tesla has been a key driver of the recent bull market and 2024’s rally. However, this also poses a problem for fund managers who are trying to outperform their benchmarks while adhering to diversification guidelines. As a result, many fund managers find themselves underweight on these tech giants, leading to underperformance compared to the overall market.
Goldman Sachs recently analyzed the positioning of large-cap mutual funds and found that only 34% of them are outperforming their benchmarks year to date. This is below the historical average of 38%, highlighting the challenges faced by fund managers in the current market environment. Additionally, large-cap value funds are outperforming their benchmarks at a higher rate compared to growth and core funds, indicating a shift in investment strategies among fund managers.
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