Active Fund Managers Active Management vs. Passive Management

Active Investors and Transaction Costs

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Active investors, as a group, must by definition underperform a strategy that passively holds a market portfolio of stocks, since active investors incur greater transaction costs. The reduced liquidity of small companies or emerging country stocks incurs higher transaction costs, making it even more difficult to outperform a passive strategy.
Source: http://www.investorguide.com/igu-article-995-stock-strategies-active-versus-passive-management.html