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Most Funds Couldn’t Beat the Stock Market in 2022, Despite Advantages



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For the stock market, 2022 was a special year. If there was any year in which stock pickers should have been able to outperform the broad market indexes, 2022 was it, yet most still couldn’t beat the battered stock market.That augurs poorly for active managers in 2023 because, so far at least, the odds have shifted.Once again, consider “megacap” tech stocks, which had terrible performances last year — much worse than the S&P 500 as a whole. The S&P 500 is a capitalization-weighted index, which means that the most valuable stocks in the markets, like those from the big tech companies, have an outsize effect on stock market returns. When they decline, the overall index tends to decline. W …

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