Up to 72% in three years: only three mutual funds beat the S&P 500 index

An analysis of actively managed mutual funds investing in the US reveals that over three years, only three funds managed to beat the shekel return of the S&P 500 index, which stood at about 35.5%. In first place is a tiny fund with a return of 72.1%, followed by Altshuler Shaham S&P 500 with 48.3% and Ayalon US Equities with 47.4%. The average return in the category is 31.1%. Senior investment managers explain why it is hard to beat the index and what is needed to succeed.

An analysis of actively managed mutual funds specializing in US equities reveals a challenging picture for Israeli investment managers. Over three years, only three funds in the category managed to beat the shekel return of the S&P 500 index, which stood at about 35.5%. At the top of the table is the 'Kivun Global US Equities' fund, a tiny fund managing 20 million shekels, with a return of 72.1%. In second place is Altshuler Shaham S&P 500, a large fund managing 615 million shekels, with a return of 48.3%, and in third place is Ayalon US Equities, another small fund managing 48 million shekels, with a return of 47.4%. The average return in the category is 31.1%. At the bottom of the table, Kessem Active US Equities stands out with a return of 11.4% and Harel Overseas US with a return of only 3%. Over 12 months, the results are more balanced: eight funds beat the shekel return of the S&P 500, which stood at 7.5%. The article includes interviews with two senior investment managers, Dror Berger from Altshuler Shaham and Ofir Weizman from IBI Mutual Funds, who explain the challenges of active management against the S&P 500 index. Berger emphasizes that the fundamental analysis they do for US companies is identical to that in Israel, and that large entities have high access to advanced information systems. Weizman argues that most funds are 'disguised indexes' that avoid taking significant positions, and that to beat the index one must identify processes over time and act on opportunities. The article also cites international studies, including the SPIVA report and the Morningstar index, showing that 79% of active US funds lagged behind the S&P 500 in 2025, and over 20 years the failure rate reached 93%.