Why Do Actively Managed Funds Remain So Popular? – CBS MoneyWatch.com

It’s no secret that actively managed funds have traditionally lagged their passively managed peers. Despite that, actively managed funds retain the lion’s share of equity fund assets, a fact that has been the source of no small amount of head scratching among academics and investment experts over the years.

The traditional explanation for this seeming conundrum has been, in a word, ignorance. That is, most experts believe that actively managed funds remain a popular choice simply because the average investor doesn’t know any better; they’re unaware of the long odds against their success.

via Why Do Actively Managed Funds Remain So Popular? – CBS MoneyWatch.com.