When is an Equity Fund Too Big for its Own Good? Learning Capacity Management Strategies
Capacity analysis is an important factor to assess a fund’s future success.
Morningstar analysts consider a variety of factors when assessing funds, including its capacity—the maximum level of money that an actively managed strategy can run without harming its alpha generation potential. When a fund’s asset size outgrows its capacity, it can lead to undesirable outcomes that can impact its fund managers and investors.
Our latest report analyzes fund capacity, its impact on the strategy’s future alpha generation ability, and how our researchers apply capacity analysis to equity fund strategies.
Download the report to learn how capacity management strategies can strengthen your investing strategy.
