Do you pick your stocks?
"We actually have seen a return to stock picking really over the back half of 2018. So for the large majority of the cycle, really since the financial crisis, we've been in a period where correlations have been really high, operating dispersion has been really low, and so stocks in general have been kind of moving together, moving in concert and so it hasn't paid as much. It's been very difficult to add value through active management or picking stocks. We think the tide is turning on that. So we've seen, over the last couple of quarters, stock picking start to matter again and in particularly with Q3 earnings from 2018, we saw a big distinction between companies who were beating and raising and thus their stocks were doing very well," said Agati.
"With those that were kind reporting in line results or missing and their stocks getting pummeled. So we do think that the tide is turning and actually our view on active versus passive exposure really depends on sort of the timing of the cycle. So we think in sort of the later innings of the cycle where we believe we are today and really at major inflection points in the cycle, that's really where you want to start shifting portfolios to have more active exposure," she continued.