@article {Strongin11, author = {Steve Strongin and Melanie Petsch and Greg Sharenow}, title = {Beating Benchmarks}, volume = {26}, number = {4}, pages = {11--27}, year = {2000}, doi = {10.3905/jpm.2000.319761}, publisher = {Institutional Investor Journals Umbrella}, abstract = {The inability of active managers to consistently outperform capitalization{\textendash}weighted benchmarks can be explained by a mismatch between those benchmarks and the underlying nature of active management. The authors show that this mismatch cannot be effectively addressed either through macro{\textendash}level risk controls or through improved stock selection. They develop a new approach to risk management that emphasizes diversification at the individual stock level and offers significant improvements in risk{\textendash}return efficiency and portfolio manager consistency; This new approach to risk management is also significantly easier to incorporate into a bottom{\textendash}up investment process. Plan sponsors can further can further improve the value of active management through combinations of new, more portfolio manager{\textendash}friendly active manager benchmarks and completion indexes that move the overall allocations back to their original capitalization{\textendash}weighted benchmarks.}, issn = {0095-4918}, URL = {https://jpm.pm-research.com/content/26/4/11}, eprint = {https://jpm.pm-research.com/content/26/4/11.full.pdf}, journal = {The Journal of Portfolio Management} }