The trend for fund managers to disclose their active shares should be applauded – but at the same time the market must ensure it doesn’t get carried away with the latest fad.

In recent days, the likes of Neptune Investment Management, Baillie Gifford and Woodford Investment Management have publicly disclosed their active shares. This metric aims to show to what extent a fund's holdings differ from that of the benchmark index to which it compares itself. The higher the figure, the more the fund manager is straying from the index. The theory is that an active manager worth his or her salt should have an active share of at least 60%, therefore justifying the higher fees they charge investors compared to passive strategies.