A
bigger spread between the best and worst stocks hasn't helped
active funds
as a group, but it does tend to make good funds better — and bad funds worse... To put it another way: Markets that aren't moving in lock step give
active managers more rope with which to climb above the pack or to hang themselves.
Though there are initially economies of scale, once you get
big enough
as an
active investment
manager, the diseconomies of scale kick in.