Passive Investing in the UK: Why Active Funds Lose

Your active fund loses to the index 8 times out of 10 over a decade. The 0.85% fee gap quietly eats an entire retirement portfolio over a career. The sales floor never mentions it.

Annual fund fees: passive vs active

Amundi Prime All Country (PACW)0.07%

HSBC FTSE All-World Index0.13%

Vanguard FTSE All-World (VWRP)0.22%

Vanguard FTSE Global All Cap0.23%

Typical active UK equity fund0.75-1.50%

Over 80% of active funds underperform the index after fees.

Key takeaways

Passive investing means buying index funds that track the whole market instead of paying a fund manager to pick stocks for you.

Over 80% of active fund managers underperform their benchmark after fees over a 10-year period. The odds are against stock picking.

A single global tracker fund inside an ISA or SIPP is all most UK investors need to build serious long-term wealth.

The biggest edge passive investors have is not a fund or a strategy. It is low costs and the discipline to leave their money alone.