Active equity fund investors outperformed equity index fund investors and the S&P 500 in the second quarter, and they also withdrew less assets than their peers, according to a Dalbar analysis released today.

The cash flow pattern in the second quarter broke an eight-year trend, the firm said.

“The average active equity fund investor outperformed the average equity index fund investor by 223 bps in the second quarter (20.97% for active versus 18.74% for index),” the Massachusetts-based financial date company reported.

Cash flows with respect to equity index funds experienced a reversal in the second quarter, going from positive territory to losses of 0.56%, 0.53% and 0.83% in April, May and June respectively. Meanwhile the net outflows for active equity funds decreased to their lowest levels of the year, the company said.

The contracting of the average equity fund investor gap was largely due to performance, Dalbar said. "We're not surprised that investors are coming back to active management in uncertain times,”

Karen Barr, President & CEO, Investment Adviser Association. told Financial Advisor Magazine. "We've long believed that active management enables investors to navigate complexity, customize portfolios, better manage risk, capitalize on specific skills or simply profit from market inefficiencies," Barr added.

All equity markets experienced a swift and deep decline in February and March as the global pandemic triggered market uncertainty. The second quarter brought with it an almost equally swift recovery. The S&P 500 followed its 12.35% slide in March with a 12.82% rebound and continued to push forward with a 4.76% gain in May and a 1.99% gain in June.

The average fixed-income fund investor was the most aggressive in withdrawing assets in the first quarter, according to Dalbar. They withdrew over 5% of assets in March, adding back 0.02% in April, 1.14% in May and 1.67% in June, Dalbar reported.

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