The stable returns on stocks and bonds that investors had in the ten years prior to 2022 didn’t provide for a favorable climate for tactical funds.
“Lacking opportunities to show their steps, while also burdened by their higher costs … the group badly trailed its rivals,” Rekenthaler said.
Additionally, he said, tactical funds had a lower chance of surviving during that period.
In comparison to strategic funds, tactical funds had lost 14.4% on average so far this year as of June 30. Rekenthaler said that this is barely enough to make up for the ground that has been lost to rivals over the years.
However, he noted that “several tactical funds have notched outright profits this year, with several more landing only slightly in the red,” suggesting that investors who hold the best-performing tactical-allocation funds would fare better.
