The Active to Passive investing shift continues. However, that gives way to opportunity in Fundamental investing.
PivotalPath noted a drop in total AUM managed by quant funds, although the firm has also found that allocator interest in this strategy has jumped significantly.
“The PivotalPath Equity Quant Index remains far below its AUM levels before performance faltered between 2016-2020,” explained Jon Caplis of PivotalPath. “However, it is fair to say that allocator interest in quant equity funds has recently increased, alongside a dramatic rebound in performance. The Index has annualized ~11% since January of 2021 through June of 2024 to lead all major hedge fund strategies with the vast majority of those returns in the form of alpha to the equity markets. It’s up 9.2% through June.