## [# Active Stock Funds Largely Lose to Index Funds: SPIVA](/sections/news/active-stock-funds-largely-lose-index-funds-spiva)
# Active Stock Funds Largely Lose to Index Funds: SPIVA
Large cap, active equity funds have been beaten by less expensive index funds over a 15-year period, new report finds.
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[By Lucy Brewster](/authors/lucy-brewster)
Mar 12, 2024
Edited by: Ron Day
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While active management has surged in popularity, funds focused on large cap stocks fail to beat their cheap, broad index counterparts despite costly, complex management techniques aimed at outperformance, a new report has found.
Sixty percent of large cap active exchange-traded and mutual funds failed to beat the S&P 500, according to the 2023 S&P 500 Indexes Versus Active scorecard (SPIVA), published March 6. That was a slight improvement from the 64% rate in 2022, yet far behind 2021, when 51% of large cap active funs underperformed the index.
"At the 15-year horizon in both asset classes, there were no categories in which the majority of active managers outperformed,“ the report stated. Still, the situation might have been worse, according to S&P DJI’s Head of U.S. Index Investment Strategy Anu Ganti who wrote in a statement that "this figure was better than might have been expected given the dominance of the U.S. equity market’s largest stocks."
The biggest actively managed ETF, [**JPMorgan Equity Premium Income ETF (JEPI)**](/jepi), which invests in large cap stocks and equity-linked notes, has [lagged](/etfanalytics/etf-comparison/JEPI-vs-SPY) broad index funds like the [**SPDR S&P 500 ETF Trust (SPY)**](/spy). JEPI, with a management fee of 0.35%, has gained 19% over the past year compared with a 35% gain in SPY, which charges a far lower 0.09%.
## Active ETF Assets Low But Growing
[Active ETFs](https://www.etf.com/topics/active-management) have become favorites of financial advisors and retail investors alike, largely because they are cheaper than active mutual funds and can deliver complex strategies as easy-to-trade ETFs. Asset ETFs grew 37% in 2023, compared to only an 8% growth rate in their passive counterparts, according to [Morningstar](https://www.etf.com/sections/news/actively-managed-etf-assets-soared-37-2023). Yet overall money in active ETFs pales in comparison to active. Active funds have total assets of $549 billion in 1,349 different products, making up only 6% of the total $8.3 trillion U.S. ETF market.
Market volatility may contribute to better performance of active strategies, as was the case in 2022, when large-cap equity active funds had their best performance year since 2009, according to S&P 500 Global. Yet in 2023’s bull market, which saw the [S&P 500](https://www.etf.com/sections/features/you-owe-your-sp-500-gains-nvidia) gain 24% over the year, the index edged out other funds.
In international equities, the overall underperformance rate was higher—74%. Yet in both U.S. and international equities, small cap funds fared better. Only 54% of international small cap funds underperformed, while 48% U.S. equity small caps underperformed the S&P SmallCap 600.
In the fixed income category, performance of active funds varied largely across categories. Overall, fixed income funds had an underperformance rate of 59%, according to SPIVA.
*Contact Lucy Brewster at* .
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[ Lucy Brewster Finance Reporter ](/authors/lucy-brewster)
Lucy Brewster is a finance reporter at etf.com covering asset managers, emerging technologies, and regulation. She hosts etf.com webinars and appears… [View Bio](/authors/lucy-brewster)
Related Topics [Active Management](http://www.etf.com/topics/active-management)
[S&P 500](http://www.etf.com/topics/sp-500)
[Large Cap](http://www.etf.com/topics/large-cap)