Written by: Bryan Sajjadi, Seth Marks, Burr Clark, and Vino Ravichandran

Fidelity research suggests active international allocations have topped index funds over time.

Key Takeaways

  • Many international equity investors have continued to prefer index-based exposures, even though Fidelity research concludes that active approaches in international equity markets have topped the performance of index funds over time.
  • Active managers can use their expertise regarding local laws and regulations and the competitive environment to avoid problematic international securities and segments.
  • The economic backdrop for inflation, geopolitics, and monetary policy could result in a broader range of potential winners and losers across multiple investment categories in the years to come, implying there may be greater opportunities for active managers across regions and countries.

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Related: The Case for Using a Sector Based Framework in Equity Portfolio Construction

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