Typical Australian Active Fund Managers outperform on a selective market cycle basis. They get hit harder when things go bad and turn more when market turns back up. Best time to invest is to hold off in the cycle and invest now - the business not the fund.
Funds with certain styles go out of fashion, like Investors Mutual, Platinum and others - when times are good they lag and are worse than indexes during upturn. They are also unlikely to improve FUM as they don’t attract new investors due to lag effect in performance.
Other Fund Managers implode or sell up. While Blue Sky Investments blew up due to accounting fraud, it isn’t a good comparison. Hunter Hall is the nearest comparison before it got bought out by SOL.
Investors could put money into an ETF that tracks an Index, but this will only ever be average and still reduce in market downturns.
Another style to consider investing in is a quant based fund. These are starting to become more prolific in the US and the Australian market is starting to see them. These funds have same problems where they can blow up spectacularly, but if they are long only focused, they tend to deliver returns above the average.
Best of Luck Lost
MFG Price at posting:
$12.50 Sentiment: None Disclosure: Not Held
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