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A New Era of Active Management Looms

The period ahead will likely be less suitable for passive strategies.

Yoram Lustig, Head of Multi-Asset Solutions
T. Rowe Price, November 2019

Key insights

  • The strong returns of passive strategies since the financial crisis have been driven by central bank quantitative easing (QE), but we believe this period is coming to an end. 

  • As the impact of QE recedes, returns are likely to fall and cross‐sectional volatility is likely to return. 

  • In order to gain from rotation within and between asset classes, investors may benefit from putting active strategies at the core of their portfolios.