New York's Attorney General issued a report on its recent
investigation of fees charged by actively managed equity mutual
funds and a metric known as "Active Share." Denoted as a
"percentage" from 0 to 100 percent, Active Share measures
the degree of overlap between a fund's portfolio and its
benchmark index. For example, an Active Share of 100 percent means
that a fund and its benchmark have no holdings in common, while an
Active Share of 0 percent means that the fund and its benchmark
have proportionately identical holdings. Active Share is only one
measure of how much "active management" is being done by
the fund's manager.
The Attorney General analyzed fee and Active Share data for more
than 2,000 funds to understand whether funds' fees reflect
their ability to outperform their benchmarks. The Attorney General
surveyed 14 major mutual fund firms "to determine whether and
how firms use the Active Share metric, and whether and how firms
disclose the Active Share
