Now that the latest SPIVA results are in, we can take a fresh look at the active vs. passive debate. Who came out on top this time and what does it mean for investors?
Key findings of the mid-year 2025 SPIVA report card:
- Global Equity General: Only 54% of active managers underperformed year-to-date, a notable improvement (but still, a massive 95.6% underperformed over 15 years).
- Australian Equity General: 71% underperformed the ASX 200 in H1 2025. Over 15 years? A daunting 85.3% fell short.
- Australian Equity Mid–Small Caps: A more favourable story, with only 58% underperforming over 15 years which is the lowest long-term lag rate among equity categories.
- Australian Bonds: Once again, active bond managers held their ground (only 46% underperformed this half), but long-term figures show 75.9% lagged over 15 years.
- A-REIT Funds: A mixed result. Only 50% underperformed year-to-date, but over the long term, 84.8% underperformed.
The factors driving these results
- Market conditions helped active managers in global equities. The underperformance of U.S. stocks and a weaker USD gave skilled managers opportunities to outperform in some areas.
- Australian equities offered fewer opportunities: The narrow spread in sector performance (just 22.5%) limited the edge active managers could gain from stock picking.
- Bond managers face new challenges: After two strong years, rising term spreads and stabilising credit spreads are making it harder to outperform.
The long-term picture remains unfavourable for active funds
While some active managers found success this half, SPIVA's long-term data is telling:
Over 15 years, most active fund managers, across all asset classes, failed to outperform their benchmarks.
That includes:
- 95.6% of Global Equity General funds
- 85.3% of Australian Equity General funds
- 75.9% of Australian Bond funds
So, what does this mean for investors?
At 5 Financial, we’re all about helping our clients feel clear and confident financially. That means understanding where active management adds value, and where it doesn’t.
Here’s what we take from the data:
- Passive funds remain a reliable choice for long-term, core-market exposure (especially when fees and consistency matter).
- Active management may still play a role, particularly in less efficient markets like mid-small caps, or during times of heightened market dispersion.
- But the burden of proof is on the active manager and consistent outperformance is rare.
Final thoughts: You don’t need to analyse this, that’s our job
If all these numbers seem overwhelming, that’s completely understandable. The world of investing can be complex, and trends like those in the SPIVA Scorecard show why it’s so important to have a clear, evidence-based strategy.
At 5 Financial, our advisers stay across all this research so you don’t have to.
We analyse the data, assess market conditions, and tailor your investment mix based on your unique goals, timeframe and circumstances. Whether that includes active, passive or a blend of both, we help ensure your strategy is not just smart, but also sustainable.
We do the homework so you can focus on what matters most: feeling clear, confident and in control of your financial future.
Want reassurance that your investments are working for you?
Let’s have a conversation. We’re here to simplify the complex, so you can move forward with confidence. Feel free to get in touch any time with your adviser if you’d like to learn more about your investment mix.
Source:
https://www.spglobal.com/spdji/en/documents/spiva/spiva-australia-mid-year-2025.pdf
Please note, the above information does not constitute financial advice and does not take into account your current circumstances or goals. Please speak with a Financial Adviser before acting on any information found here or throughout the 5 Financial website.
