Contrary to popular opinion, it is quite possible for asset managers to beat the index. It’s too bad that nearly all of them go about it the wrong way. According to advisory firm Wealth Logic, the chances of an active manager outperforming an indexed fund net of fees is 42% over one year, 30% over five and 23% over 10.

Managers strive to make their brands look as alluring as a Fabergé egg, but spend too little time diagnosing the cracks in their performance records.