It’s best to play China through actively managed strategies because they can harvest the inherent inefficiencies in emerging markets or so many investors would argue.
Yet new research from Morningstar suggests that may not always be the case, and certainly not in the past few years at least when it comes to a large swathe of local products.
As of mid-2019, fewer than half of active China-domiciled broadly diversified stock-heavy funds had outperformed their average passive peer over one, three and five years.
This is heavily down on previous years, given 70.8% of active managers outperformed their average passive peer in the 10 years...
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