The success stories are loud. The people who tried the same thing and lost went quiet.
You only hear from the survivors.
January 2015. These are the top six funds on the list. You have €12,000 in twelve chips.
A list of top performers is a list of survivors. Count the ones that closed.
← Red LinesRed Line 41 of 48 The idea The numbers Where you see it Where it bends This game’s numbersHow strong the proof isAStrong proof Where it comes from
Rankings, ads and stories show who is still here. Those who tried the same thing and failed are gone from the picture, so it looks easier than it was.
20 funds start together. Ten years later, the 8 still advertised averaged 9% a year. The 12 that closed after bad years averaged −2%. All 20 together: about 2.4% a year.
Many funds close or merge after bad years and drop out of the tables. The average fund in a list is often the average survivor.
Survivors can still teach something. Just not the whole story.
S&P Dow Jones Indices, SPIVA Europe Scorecard, year-end 2016S&P Dow Jones Indices, SPIVA Europe
Leaving out the funds that closed makes the rest look better than they were, a bias measured again and again.
- Survivor Bias and Mutual Fund Performance Edwin J. Elton, Martin J. Gruber & Christopher R. Blake, Review of Financial Studies 9(4), 1097-1120, 1996
- Survivorship Bias in Performance Studies Stephen J. Brown, William N. Goetzmann, Roger G. Ibbotson & Stephen A. Ross, Review of Financial Studies 5(4), 553-580, 1992
Checked 2 Nov 2026 · How we grade
- A Strong proof: Many good studies or long official data, from different teams or countries, point the same way.
- B Good proof, with limits: Solid studies agree on the direction, but the size varies, or the data covers few places or few kinds of people.
- C Mixed proof: Some good studies for, some against, or the evidence covers only part of the line.
- D Thin proof: Mostly one book’s argument, one survey or stories. It may be wise, but it has not been tested well.
- = True by the sums: It follows from arithmetic, so no study can overturn it. We still show what real data says.
Nassim Nicholas Taleb, Fooled by Randomness (2001). In our words, not quoted.
See it in numbers: Active funds (From Zero)
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