Value equity strategies emerged as the top performers in a quarter that saw relatively sluggish performance overall, according to Morningstar Inc.'s separate account/collective investment trust database. Six of the top 10 separate account domestic equity strategies for the year ended Dec. 31 were value strategies.
“The overall equity (universe) dropped in performance, I would say, quite significantly compared to the last quarter,” said Andy Kwon, data analyst for Chicago-based Morn-ingstar.
The median return for the fourth quarter was 0.99%, and while that is still in positive territory, it falls behind the median return of 5.82% for all stock portfolios in the third quarter. The Russell 3000 Index returned 0.25% for the quarter. The median return for the year ended Dec. 31 was 15.52%, while the Russell 3000 returned 16.42%.
Value equity strategies had the highest median return of domestic equity strategies in the fourth quarter at 2%, while blend strategies had a median 1.38% and growth, 0.05%.
Small caps were still dominating, accounting for five strategies in the top 10; that was a dip from the quarter previous, when eight of the top 10 strategies for the year ended Sept. 30 were small cap.
Only two of the previous quarter's top 10 strategies — both small-cap value — were present this quarter.
“Naturally you would assume that some of the top 10s may fall slightly down the chain,” Mr. Kwon said. “There were a few that dropped all the way down into the 90s. That was very interesting to see. I can't quite deduce what exactly happened, but it is definitely a big shift.”