Smart beta slips in 2017

The one-year outperformance of U.S. smart-beta funds slid in the first two quarters after eight consecutive positive quarters. The strategies gained popularity following the recession in part due to lower fees relative to active funds and higher consistent outperformance. Prior to 2017, smart-beta funds hadn't underperformed as a group since the second half of 2014 when they underperformed by about 30 basis points. Average 12-month outperformance since the start of 2010 was about 1.15%, relative to respective benchmarks.

Assets were approximately $3.6 billion as of June 30, according to data from eVestment, adding about $600 million since the end of June 2016.

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