Info · Reference
How often does active management beat the index?
Twice a year, S&P Dow Jones Indices publishes the SPIVA Scorecard — a tally of how many professional, actively managed funds actually beat the plain index they're measured against. The numbers below are the share that fell short. The pattern is remarkably consistent: the longer the clock runs, the more managers fall behind.
Data as of Dec. 31, 2025 S&P Dow Jones Indices, “SPIVA U.S. Scorecard, Year-End 2025.” Figures are the share of actively managed funds that underperformed their benchmark (absolute return). As of Dec. 31, 2025. · source & method
- 86% of US large-cap funds trailed the S&P 500 over the last 10 years
- 95% of all US stock funds trailed their benchmark over 20 years
- 79% trailed over just 1 year — even short-term, most don't win
The full scorecard
Each number is the percentage of funds in that category that underperformed their benchmark index over the period, so higher means worse for active management. A blank means SPIVA doesn't report that category at that horizon. The 10-year column is highlighted as a sensible middle horizon.
| Fund category | Benchmark | 1y | 3y | 5y | 10y | 15y | 20y |
|---|---|---|---|---|---|---|---|
| U.S. stock funds | |||||||
| All domestic funds | S&P Composite 1500 | 80% | 80% | 91% | 90% | 93% | 95% |
| Large-cap funds | S&P 500 | 79% | 67% | 89% | 86% | 90% | 93% |
| Mid-cap funds | S&P MidCap 400 | 55% | 63% | 72% | 81% | 84% | 90% |
| Small-cap funds | S&P SmallCap 600 | 41% | 42% | 63% | 76% | 90% | 90% |
| Large-cap growth funds | S&P 500 Growth | 96% | 56% | 95% | 92% | 98% | 100% |
| Large-cap value funds | S&P 500 Value | 41% | 81% | 83% | 88% | 93% | 87% |
| Real estate funds | S&P United States REIT | 84% | 89% | 97% | 84% | 90% | 91% |
| International stock funds | |||||||
| Global funds | S&P World | 76% | 87% | 95% | 93% | 96% | — |
| International funds | S&P World Ex-U.S. | 63% | 76% | 80% | 90% | 93% | — |
| International small-cap funds | S&P Developed Ex-U.S. SmallCap | 70% | 69% | 70% | 74% | 79% | 85% |
| Emerging market funds | S&P Emerging Plus | 53% | 70% | 74% | 88% | 90% | 94% |
| Bond funds | |||||||
| Government funds | iBoxx $ Domestic Sovereign & Sub-Sovereigns | 94% | 95% | 91% | 100% | 85% | — |
| High-yield bond funds | iBoxx $ Liquid High Yield | 76% | 84% | 74% | 87% | 86% | 82% |
Above 50%, more than half the professionals in a category lost to a fund that simply bought the index and held it.
Why this happens
- Costs are a near-certainty; outperformance isn't. A fund's fees and trading costs come out every year, whether or not its picks beat the market. Over a decade that steady drag is hard to overcome — see fund fees over time.
- Active management is a zero-sum game before costs. For every investor who beats the market, another must lag it, because together they are the market. After costs, the average active dollar must trail a low-cost index dollar — an arithmetic point, not a forecast (W. Sharpe, 1991).
- Winners are hard to identify in advance. A fund near the top over one stretch is roughly as likely as any other to lag over the next. Past performance genuinely doesn't predict future performance.
None of this says beating the index is impossible — a minority of funds do, and this is a description of the odds, not advice about what you should hold.
Sources & method
Failure rates are transcribed directly from the SPIVA U.S. Scorecard (absolute-return tables). Refresh when S&P Dow Jones Indices publishes a new scorecard (npm run data:spiva).
Research
- Sharpe, W. F. (1991). “The Arithmetic of Active Management.” Financial Analysts Journal 47(1): 7–9.
- Fama, E. F., & French, K. R. (2010). “Luck versus Skill in the Cross-Section of Mutual Fund Returns.” The Journal of Finance 65(5): 1915–1947.
- Malkiel, B. G. (1973). A Random Walk Down Wall Street. W. W. Norton & Company.
Data
- SPIVA U.S. Scorecard (Year-End 2025), S&P Dow Jones Indices. © S&P Dow Jones Indices LLC. S&P DJI prohibits redistribution or reproduction of the report without permission; only a few specific figures are transcribed here, with attribution, as brief factual quotation.
Educational use only, not financial advice. Every figure traces back to the sources above or to the inputs you set — the full method and the source code are public.