The Tell: For some funds, size isn’t the enemy of performance

Everybody knows that when it comes to investing, size is the enemy of performance.

But a study of mutual fund performance in 2016 published Tuesday by research firm Birinyi Associates runs against that conventional wisdom—at least in part.

The bigger-isn’t-better argument is familiar. After all, the larger the asset base, the harder it can be to move the performance needle. It’s why some successful hedge-fund managers return capital to investors. Warren Buffett himself has warned that Berkshire Hathaway’s enormous size makes it harder to beat the market.

Birinyi’s study provides some evidence that heft isn’t necessarily an obstacle to outperformance.

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