S&P: Active Fund Managers Underperform Benchmarks Over Long Periods of Time

Leading Index Provider Reintroduces SPIVA Scorecard with Enhancements

NEW YORK, Nov. 13 /PRNewswire-FirstCall/ -- Standard & Poor's Index Services
reintroduced today an enhanced version of its widely followed Standard &
Poor's Indices Versus Active Funds Scorecard (SPIVA). The improved SPIVA
Scorecard now offers broader asset class coverage and mutual fund data derived
from CRSP Survivor-Bias-Free U.S. Mutual Fund Database. SPIVA reports
performance comparisons corrected for survivorship bias, shows equal- and
asset-weighted peer averages, and provides measures of style consistency
covering actively managed U.S. equity, international equity and fixed income
mutual funds.

The SPIVA Scorecard shows that for the five-year period through June 30, 2008,
the S&P 500 outperformed 68.6% of actively managed large-cap funds, the S&P
MidCap 400 outperformed 75.9% of actively managed mid-cap funds and the S&P
SmallCap 600 outperformed 77.8% of actively managed small-cap funds.

Results were similar within the international arena. Among global equity
funds, five year results show the S&P Global 1200 outperforming 70.1% of
global equity funds, the S&P International 700 outperforming 86.5% of
international equity funds, and S&P IFCI Composite outperforming 73.9% of
emerging market funds.

"Over a five year horizon, our research shows a majority of active managers
underperform indices. This is true even in relatively inefficient segments of
the market such as small capitalization stocks and emerging markets," says
Srikant Dash, Head of Global Research & Design at Standard & Poor's Index
Services.

Among fixed income funds, more than three quarters of actively managed
domestic bond funds were outperformed by benchmarks in all categories over a
five year horizon. Emerging market bond funds was the only category in which a
majority of active managers beat the benchmark.

"The percentage of active managers underperforming benchmarks over five years
is higher for fixed income funds compared to equity funds," says Rosanne Pane,
Director at Standard & Poor's Index Services. "We theorize that this is
because of relatively higher transaction costs and lower cross-sectional
dispersion in fixed income markets."

Standard & Poor's data is corrected for survivorship bias, which has been
known to skew traditional fund analysis. Over five years, 26.8% of U.S. equity
funds, 22.5% of global equity funds and 24.7% of fixed income funds have been
merged or liquidated. "This highlights the importance of addressing
survivorship bias in mutual fund analysis," adds Dash.

The enhanced SPIVA Scorecard is produced semi-annually, and can be accessed in
its entirety at: www.spiva.standardandpoors.com.

About SPIVA
The SPIVA scorecard reveals quarterly performance data for U.S. equity,
international and fixed income mutual funds benchmarked against appropriate
asset class indices. More than 3500 actively managed funds are covered in the
scorecard.

The SPIVA methodology is designed to provide an accurate and objective
apples-to-apples comparison of funds' performance versus their appropriate
style indices, correcting for factors that have skewed results in previous
index-versus-active analyses in the industry. SPIVA scorecards show both
asset-weighted and equal-weighted averages, include survivorship bias
correction to account for funds that may have merged or been liquidated during
the period under study, and show style consistency for each style group across
different time horizons.

About Standard & Poor's Index Services
Standard & Poor's Index Services, the world's leading index provider,
maintains a wide variety of investable and benchmark indices to meet an array
of investor needs. Its family of indices includes the S&P 500, an index with
$1.5 trillion invested and $4.85 trillion benchmarked, and the S&P Global
1200, a composite index comprised of seven regional and country headline
indices. For more information, please visit
http://www.standardandpoors.com/indices.

About Standard & Poor's
Standard & Poor's, a division of The McGraw-Hill Companies (NYSE: MHP), is the
world's foremost provider of financial market intelligence, including
independent credit ratings, indices, risk evaluation, investment research and
data. With approximately 8,500 employees, including wholly owned affiliates,
located in 23 countries and markets, Standard & Poor's is an essential part of
the world's financial infrastructure and has played a leading role for more
than 140 years in providing investors with the independent benchmarks they
need to feel more confident about their investment and financial decisions.
For more information, visit http://www.standardandpoors.com.

SOURCE Standard & Poor's

David Guarino, Communications, Standard & Poor's, +1-212-438-1471,
dave_guarino@standardandpoors.com