This document incorporates all of the analysis above. Manager selection is secondary, but significant. They think there are managers who through brilliance and skill can easily beat the market. Analysis of thousands of funds and managers over long periods of time indicate that past performance is no indication of future performance. Briefly, the playing field is level.
Many managers have access to the same information at the same time.
There are thousands of intelligent managers competing. When one is buying another is selling in a zero-sum game. Managers are in the position not of just finding undervalued securities, but of finding undervalued securities that other managers will realize are undervalued. Capital moves very quickly so it is hard to exploit opportunities for long. Our primary goal is to select managers whose style is consistent with the investment policy.