With the S&P 500 (^GSPC) having gained in the post-election rally, some portfolio managers, whose performance is often measured against the index, are scrambling to gain in the final quarter before the end of the year. Ritholtz Wealth Management chief market strategist Callie Cox joins Market Domination Overtime Hosts Julie Hyman and Josh Lipton to discuss her market outlook for the rest of 2024.
“A lot of people on Wall Street talk about performance chasing or those portfolio managers who are judged on how their stocks do every year in relation to the S & P 500 or another benchmark. It’s becoming a difficult time for them,” Cox says.
“They have to exceed the 25% higher benchmark this year and the benchmark [only] about 30% of its stocks outperformed the index,” he explains.
“Right now, portfolio managers are having a really tough year because their performance is based on whether they do better than the S&P 500, not how the S&P 500 does,” said the expert, adding, “There may be a chase. At the end of the year, some buy stocks to push performance.” less in this money.”
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This article was written by Naomi Buchanan.