Active U.S. Funds Not Quite So Bad?

The 2024 S&P Indices Versus Active (SPIVA) Scorecard finds that a supermajority of active U.S. funds underperform respective benchmarks. Is that finding representative of investor experience? In the May 2026 draft of their paper entitled "How the SPIVA U.S. Scorecard Understates the Performance of Actively Managed Mutual Funds", Martijn Cremers, Jon Fulkerson and Timothy Riley restate the question addressed by the SPIVA Scorecard.

• The Scorecard asks: what percentage of active funds either do not survive the full horizon or underperform the respective category benchmark indexes?
• The authors ask: what percentage of active fund assets underperform equivalent passive funds?

They therefore adjust the SPIVA methodology, as follows:

1. Instead of treating a fund that exits the sample as an underperformer, they use the actual returns of such a fund until its exit.
2. Instead of weighting all funds equally, even though most assets are in a few large funds, they consistently weight by fund assets.
3. Instead of using hypothetical benchmarks (total return indexes), they use existing equivalent passive funds.

They then compare SIVA results, replicated SPIVA results and adjusted results. Using categories and total returns from the same fund database used to generate SPIVA reports, along with returns for matched S&P benchmark indexes and passive tracking funds, during 2005 through 2024, they find that: