Before (and after) hiring an investment manager whose approach is to actively manage a stock (or bond) portfolio, a thorough examination should be performed to determine if the manager has added value compared to a market-based (passively managed) benchmark. The reason these tests need to be performed is that overwhelming evidence shows the vast majority (80% - 99% depending on method of measurement) of active money managers have not added value.

Source: www.investorguide.com

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