I'm sure Christine Benz from Morningstar would like to have that one back. As recounted in this Moneywatch blog post by Nathan Hale, Benz said:
"You want a strategy that makes sense to you, that intuitively appeals to you. For example, one strategy I find personally compelling is the contrarian strategy, where a manager is looking for high-quality companies but wants to buy them cheaply.”
Hmmm... as opposed to most investors, who want low-quality stocks that are expensive? I know what she meant - she is arguing for a value strategy. Of course, you don't need active funds to get a value strategy -- there is the Vanguard Value Index Fund (VIVAX), for instance.
Although, it is hard to argue that low-cost index funds are not the best option for the majority of investors. But there are some studies that indicate that among active funds, those that are most active do the best. We are not as religious about active/passive as Hale, but we do fundamentally believe that if you're going to pay for an active fund, you should get an active fund.
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