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Rekenthaler Report

Bond-Fund Managers Enjoy a Happier Hunting Ground

Active managers of bond funds have a better shot at outperformance than their equity fund counterparts.

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The Easier Route
"Looking for Easy Games in Bonds," published last week by Michael Mauboussin of Blue Mountain Capital Management, posits that taxable bond-fund managers are fortunate. Whereas the Paradox of Skill has eroded equity-fund managers' opportunities, by raising the level of competition so that few active investors can succeed, the bond market has been kinder. Its professionals enjoy prospects that stock-fund managers do not.

Mauboussin supports his claim both directly and indirectly.

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John Rekenthaler does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.