Active share measures how much a portfolio differs from its benchmark. A perfect index fund has 0% active share. We run at 95–98%.
That’s not a deliberate stylistic choice — it’s an arithmetic consequence of our screening. When you remove fossil fuel companies, weapons manufacturers, companies with settlement histories, and the rest of our exclusion criteria, you kick out a large fraction of the standard global index by weight. What remains naturally looks very different from the benchmark.
This matters because it means our performance will diverge from the index. Some years we’ll lead. Some years we’ll trail. That divergence is the deal, not a malfunction.
Managers who claim to be “active” but run 60–70% active share are largely charging active fees for index-like returns. We think that’s a worse trade-off than owning what you actually believe in and accepting the variance that comes with it.
Investment strategies involve risk of loss. Past performance does not guarantee future results. High active share increases tracking error relative to benchmark indices.