SUMMARY
The SPIVA Latin America Scorecard measures the performance of actively managed funds across Brazil, Chile and Mexico against their respective benchmarks over various time horizons, providing statistics on outperformance rates, survivorship rates and fund performance dispersion.
Since the first publication of the S&P Indices Versus Active Funds (SPIVA) U.S. Scorecard in 2002, S&P Dow Jones Indices has been the de facto scorekeeper of the ongoing active versus passive debate.
Mid-Year 2022 Highlights
In the first half of 2022, performance among Latin American active managers was greatly mixed across countries. Mexico was a rare bright spot, with less than 50% of managers underperforming the S&P/BMV IRT. The majority of active managers in Brazil and Chile failed to outperform over longer periods.
Mexico
The S&P/BMV IRT lost 9.3% over the first half of 2022, and 63% of active managers outperformed the S&P/BMV IRT over that period.
Fewer funds were able to maintain their record of outperformance over the five-year period, with 80% of the funds underperforming their benchmark.
Coupled with the outperformance of most active managers in the first half of the year, the survival rates of active funds in Mexico were among the highest in Latin America, at 100%, 94%, 91% and 78% over the 1-, 3-, 5-, and 10-year periods, respectively.
Brazil
The S&P Brazil BMI fell by 8.94% YTD, and 57% of Brazil Large-Cap funds underperformed the index. Their long-term record was even worse, with 80% of funds underperforming over a 10-year period.
Large-cap companies only declined by 6.15% YTD, as measured by the S&P Brazil LargeCap. Funds in this category lost 8.14% and 7.34% on equal- and asset-weighted bases, respectively, over the same period.
Chile
Chilean equities were a bright spot, with the S&P Chile BMI up 20.46% YTD. However, 94% of Chile Equity funds underperformed the index over the same period, and 98% of Chilean Equity funds underperformed over 10 years.
Larger funds performed relatively better than smaller funds over one and three years periods on average, while smaller funds outperformed over five and ten-year periods.
Fixed Income
Meanwhile, 64% of Brazil Government Bond funds outperformed their benchmark over a six-month period. Consistent with their equity peers, rates of underperformance increased over longer periods.
Brazil Corporate Bond funds fared slightly worse, with 53% underperforming their benchmark over a six-month period.
