{"id":1781,"date":"2012-05-20T13:07:25","date_gmt":"2012-05-20T11:07:25","guid":{"rendered":"https:\/\/clusterfamilyoffice.com\/blog\/?p=1781"},"modified":"2012-05-20T13:07:25","modified_gmt":"2012-05-20T11:07:25","slug":"el-criterio-de-mediocridad-en-cifras","status":"publish","type":"post","link":"https:\/\/clusterfamilyoffice.com\/en\/el-criterio-de-mediocridad-en-cifras\/","title":{"rendered":"The Mediocrity Criterion in figures"},"content":{"rendered":"

\"\"There is no greater failure than that of someone who gives up on success. Something similar happens to investment funds that stick to their benchmark indices, confident that, despite their mediocrity, the firms they work for will have no trouble marketing these funds on a massive scale, and will never blame them for failing to shine. A bank\u2019s commercial capacity is directly proportional to the mediocrity of its investment products<\/strong>. Perhaps it\u2019s because Necessity is the mother of invention<\/em>, and fund managers at independent fund management firms (which do not belong to banks, at least not directly) can only compete for a place in the investment sales arena by demonstrating sheer quality and superior returns compared with their competitors.<\/p>\n

We once dubbed this relinquishment of quality \u2013 practised by many managers who are well aware of their own mediocrity and inability to carve out a place for themselves amongst the most brilliant managers \u2013 as The Criterion of Mediocrity<\/strong>, articles we wrote in a first<\/a> and a second part<\/a> It has now been almost three years. And, sadly, this mindset continues to prevail \u2013 more than ever \u2013 in the barren wastelands of fund management. That is why the real oases (not mirages) that we occasionally come across, almost as if on an archaeological dig, whilst traversing the desert of financial advice, are all the more valuable.<\/p>\n

Another obstacle facing Spanish investors, in addition to a lack of brilliance, is the practical impossibility of investing in excellent funds \u2013 both domestic and international \u2013 that do not feature in the sales catalogues of Spanish financial institutions. Other major funds and leading players in global fund management are not even registered for sale on the Spanish market, meaning they are subject to tax penalties, which makes investing in them prohibitively expensive.<\/p>\n

\"\"That\u2019s right: whether due to commercial interests or the country\u2019s financial isolation, fuelled by the Spanish banking sector\u2019s voracious appetite for commission (which deters major fund managers from registering their products for sale in Spain) and its insular corporatism, the fact remains that only a few \u2013 very few indeed \u2013 of the world\u2019s best investment funds are accessible to the average Spanish investor. Only those savers who are best informed and have assets of around one million euros will be able to access the best advisers, who will pave the way for them to international investment vehicles that will indeed allow them to include the world\u2019s leading fund managers in their portfolios. The past, present and future\u2014as far as wealth growth and the quality of their portfolios are concerned\u2014belong to them. We have always found it surprising that this situation \u2013 the inability to access the world\u2019s best funds \u2013 is completely unknown to the vast majority of investors, including many employees \u2013 who are, of course, also mediocre \u2013 of financial institutions. It is undoubtedly a very well-kept secret by those who greedily dominate the market for selling mediocrity in Spain \u2013 that is to say, the banks.<\/p>\n

Meanwhile, articles such as this one from FundsPeople<\/a> These will give you a slight idea of the mediocrity that prevails in the world of investment funds marketed in Spain. As a point of reference, I can tell you that only 14% of the largest domestic equity funds engage in \u00abactive management\u00bb \u2013 in other words, they invest in shares and sectors other than those specified by their benchmark index (the measure used is a tracking error >5%). The rest \u2013 86% of the fund managers in that category \u2013 stick closely to the index so that their shortcomings go unnoticed and they are never singled out for their poor decisions. A veritable condemnation of the mediocrity of those who fail to distinguish the quality of good investments from the danger of bad ones. Disgusting, abominable and extremely dangerous in the current climate.<\/p>\n

There is no worse failure than that of someone who does not dare to succeed. But worst of all is that the banking sector, with its incredible ability to sell its long-suffering customers any old rubbish wrapped up with a bow and given a fancy name, is drowning Spain\u2019s savings in a sea of mediocrity which, in the medium and long term, will irrevocably ruin the least well-informed members of the population, in other words, the majority of investors.<\/p>\n

For goodness\u2019 sake, in times like these, get out of there and find someone who can provide you with competent and honest advice and guidance (a rare combination, but one that does exist). Because in the desert we\u2019re currently traversing, only those who, alongside their advisers, ride on the backs of the world\u2019s best fund managers will survive. There will be no future for mediocre investors, I can assure you.<\/p>\n\n\n\n\n\n\n\n
Degree of active management of Spanish funds<\/strong><\/caption>\n
<\/td>\nThe 100 biggest<\/strong><\/td>\nThose with assets worth more than 50 million<\/strong><\/td>\n<\/tr>\n
Index-tracking funds (TE 0%-2%)<\/td>\n45%<\/td>\n57%<\/td>\n<\/tr>\n
Benchmark-linked funds (TE 2%-5%)<\/td>\n42%<\/td>\n19%<\/td>\n<\/tr>\n
Actively managed funds (TE >5%)<\/td>\n14%<\/td>\n24%<\/td>\n<\/tr>\n
Source: Morningstar and Aviva Gesti\u00f3n. TE: Tracking Error<\/td>\n<\/tr>\n<\/tbody>\n<\/table>","protected":false},"excerpt":{"rendered":"

No hay peor fracaso que el de quien renuncia al \u00e9xito. Algo parecido les ocurre a los fondos de inversi\u00f3n que se ci\u00f1en a sus \u00edndices de referencia, confiados en que, a pesar de su mediocridad, las entidades para las que trabajan no van a tener ning\u00fan problema en comercializar masivamente dichos fondos, y jam\u00e1s […]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[54,51,57,40,37,48,55],"tags":[],"class_list":["post-1781","post","type-post","status-publish","format-standard","hentry","category-asesoramiento-patrimonial-deportistas-artistas","category-banca","category-funcionamiento-family-office","category-gestion-financiera","category-reflexion","category-asesoramiento-patrimonial-multi-family-office-crear-mi-propio-family-offices","category-necesito-un-family-office"],"_links":{"self":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/1781","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/comments?post=1781"}],"version-history":[{"count":0,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/1781\/revisions"}],"wp:attachment":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/media?parent=1781"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/categories?post=1781"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/tags?post=1781"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}