SUMMARY
- S&P Dow Jones Indices has been the de facto scorekeeper of the ongoing active versus passive debate since we first published the SPIVA U.S. Scorecard in 2002. Over the years, we have expanded the scorecard coverage into Australia, Canada, Europe, India, South Africa, Latin America, the Middle East and North Africa, and Japan.
- The SPIVA Japan Scorecard reports on the performance of actively managed Japanese mutual funds against their respective benchmark indices over 1-, 3-, 5-, and 10-year investment horizons.
- In this scorecard, we evaluated the returns of more than 774 Japanese large- and mid-/small-cap equity funds, along with more than 784 international equity funds investing in global, international, and emerging markets, as well as U.S. equities.
- International equity markets posted stronger returns than the domestic equity market in the first half of 2021; however, a higher number of foreign equity funds underperformed their respective benchmark than domestic equity funds.
- There was no consistent trend in the yearly active versus index figures, but we have consistently observed underperformance for the majority of Japanese active funds in most categories over the 10-year period.
Domestic Equity Funds
- In the 12-month period ending June 2021, the S&P/TOPIX 150 and S&P Japan MidSmallCap posted strong gains of 30.40% and 22.96%, respectively. Over the same period, 58.1% and 26.1% of large- and mid-/small-cap equity funds underperformed their respective benchmarks, with average gains of 29.94% and 28.31%, respectively.
- Over the 5- and 10-year horizons, 77.4% and 79.4% of Japanese large-cap funds underperformed the S&P/TOPIX 150, and they delivered lower equal-weighted average returns than the benchmark. In contrast, the percentage of underperforming funds in the Japan mid-/small-cap fund category was much smaller, and the equal-weighted average fund returns exceeded the S&P Japan MidSmallCap index return.
- As of June 2021, 94.4% and 96.9% of Japanese large- and mid-/small-cap funds, respectively, survived during the one-year period, though the survivorship rates dropped to 62.8% and 67.8%, respectively, over the 10-year period.
