For more than two decades, the SPIVA^® Scorecards have contributed to the active versus passive debate by measuring the performance of active funds against market benchmarks. Since the publication of the first SPIVA U.S. Scorecard in 2002, the methodology has been applied consistently across regions, asset classes and market cycles.¹

Performance measurement can be approached from different perspectives. Before interpreting the results, it is therefore important to understand the question an analysis is designed to answer. SPIVA is designed to answer a specific question.

Of the actively managed funds available to an investor at the beginning of a period, what proportion survived and outperformed an appropriate market benchmark by the end of that period?

The methodology is designed around this objective and is applied consistently across markets and through time.

Different Questions Require Different Metrics

Not all investment strategies seek the same outcome. Active funds seek to outperform a benchmark, while passive funds seek to track a benchmark as closely as possible. The appropriate evaluation metrics therefore differ.

For active funds, a key question is whether the fund outperformed a relevant benchmark. For passive funds, the focus is typically on tracking difference and tracking error, which measure how closely a fund follows its benchmark. A passive fund that follows benchmark performance, less fees, would generally be considered to have fulfilled its objective. Applying an analytical framework designed for active funds to passive funds would therefore not address the objective that passive funds are designed to achieve.

Different approaches to evaluating active management can produce different perspectives. For example, one could focus on the average fund, the average invested dollar, surviving funds only or performance relative to a collection of investment products. Each approach may be informative, but each addresses a different question.

SPIVA focuses on active funds' ability to outperform relative to benchmarks and applies that framework consistently across time periods and fund categories.

Benchmarks Matter

Benchmark selection is a critical part of performance measurement. A useful benchmark should represent the market opportunity set that a fund category intends to access and provide a consistent reference point for comparison across funds.

SPIVA begins with independently defined fund categories supplied by external fund-data vendors and then selects representative market benchmarks based on the characteristics of the category, the historical performance characteristics of its funds as a group and relevant market practices.

For example, the SPIVA New Zealand Scorecard uses the S&P World Index in NZD total return terms² as the benchmark for Global Equity funds. As shown in Exhibit 1, the S&P World Index exhibited correlations of 0.99 to 1.00 with two widely used benchmarks in the category and a correlation of 0.97 with the category's asset-weighted average return over the three years ending June 30, 2026. Longer-term correlations are in a similar range. These results support its use as a closely aligned and consistently applicable category benchmark.

Why SPIVA Starts with the Original Opportunity Set

Survivorship is an important consideration in long-term fund performance analysis. When investors select funds, they cannot know which will survive, merge or liquidate over the intended investment horizon. All funds available at the outset therefore form part of the investor's opportunity set.

SPIVA evaluates performance using the original fund universe rather than limiting the analysis to funds that survive until the end of the period. This helps address survivorship bias and prevents the analysis from benefiting from hindsight. Excluding non-surviving funds would remove part of the opportunity set investors actually began with and could present an incomplete picture of their eventual outcomes.

Exhibit 2 illustrates this effect using New Zealand Equity funds. Over the 15-year period ending June 30, 2026, 46% of the original fund universe did not survive, and only 8% both survived and outperformed. Among surviving funds alone, approximately 86% underperformed, compared with an overall underperformance rate of 92% when the original opportunity set was retained.

More than One Headline Number

SPIVA's underperformance rate is often its most cited statistic, but it is only one part of the scorecard. SPIVA also reports equal-weighted and asset-weighted performance, survivorship statistics and quartile performance.

Exhibit 3 shows the range of outcomes among surviving funds over the five-year period ending June 30, 2026. In the Global Equity fund category, top- and bottom-quartile breakpoints were 13.5% and 8.0%, respectively, compared to 16.6% for the S&P World Index. For Global Equity (Hedged) funds, the corresponding breakpoints were 10.8% and 5.4%, compared with 12.2% for the S&P World NZD Hedged Index. The comparison illustrates both the dispersion of active fund outcomes and the potential influence of currency treatment on performance.

Conclusion

Different methodologies may arrive at different conclusions because they are designed to answer different questions. SPIVA provides a transparent and consistent framework for examining how frequently active funds have survived and outperformed an appropriate market benchmark. Understanding the question being asked is the first step in interpreting the answer.

¹ For more information and background on the SPIVA Scorecards, please see SPIVA By the Numbers: A Global Perspective and What is SPIVA?

² The S&P World Index was launched on Feb. 13, 2009, while its NZD-denominated versions were launched on Oct. 25, 2024.

This content may be AI-assisted and is composed, reviewed, edited, and approved by S&P Global.

The posts on this blog are opinions, not advice. Please read our Disclaimers.

After political turmoil pushed it down in 2024,¹ South Korea recovered and was the best-performing equity market globally in 2025 (as measured by the S&P Korea BMI), and it has continued to outperform as of August 2026 (up 78.7% YTD versus 14.8% for the S&P Global BMI). The performance of the stock market has fluctuated over the years, but one debate has remained constant: South Korea's market classification. Whether South Korea is classified as a developed market or an emerging market can materially affect country weights in an index. A 2020 Indexology^® Blog post² explored how the inclusion of South Korea in emerging market indices could crowd out less-developed countries. Six years later, what has changed?

To answer that, it helps to revisit South Korea's classification. Since 2001, S&P Dow Jones Indices (S&P DJI) has classified South Korea as a developed market, a decision reaffirmed over the years based on feedback from a wide range of market participants. Since 2020, the South Korean economy has remained healthy, with GDP growing an average of 2.3% annually³ and its GDP per capita holding steady alongside the levels of other developed markets (see Exhibit 1).

Consistent with this, the float-adjusted market capitalization (FMC) of the S&P Korea BMI went from USD 0.91 trillion on Dec. 31, 2024, to USD 2.98 trillion as of Aug. 31, 2026. Even as the amount of foreign capital entering the stock market has grown,⁴ the government has released a series of reforms aimed at further enhancing its accessibility and liquidity.⁵, ⁶, ⁷ Still, not all index providers share the same classification perspective, reflecting different market expectation frameworks. Let's look at how South Korea's inclusion impacts the composition of indices.

Amid the outperformance of South Korean equities, the market's footprint on global benchmarks has increased. As of the end of August 2026, South Korea represented 2.7% of the total FMC of the S&P Developed BMI, up from 2.2% in December 2020. However, its weight has grown even more sharply when placing it within an emerging market classification. In the S&P Emerging Plus AllCap Index, which includes South Korea, the country's weight went from 14.3% to 18.6% over the same period. As South Korea's weight has increased, so has its crowding-out effect (see Exhibit 2). When including South Korea in emerging market indices, weight in other less-developed countries is reduced.

The soaring of South Korean equities can mainly be attributed to the hardware and semiconductor industries, which have outperformed in the country amid growing interest in companies central to the AI revolution.⁸ From December 2024 to August 2026, the S&P Korea BMI had a cumulative performance of 341.2%, with the main contributors to performance being Samsung (388.7%), from the Technology Hardware, Storage & Peripherals GICS^® industry, and SK Hynix (862.7%), classified under the Semiconductors & Semiconductor Equipment GICS industry,. While the crowding-out effect of the semiconductors industry has remained modest at less than 1.0%, the impact has been more pronounced in the hardware industry, where the weight jumped from 2.8% to 8.8% when South Korea is included, largely due to Samsung's dominant presence (see Exhibit 3). When South Korea was included in emerging market indices, Samsung and SK Hynix crowded out other industries.

Recent developments in the South Korean stock market and economy are consistent with S&P DJI's developed market classification. Its inclusion in emerging market indices, however, has shown the potential to crowd out weights in less-developed countries and certain industries. S&P DJI offers indices that reflect a range of different perspectives, providing alternative lenses through which global equity markets can be viewed and measured.

¹ River Akira Davis and Jason Karaian, "South Korea's Already Shaky Markets Further Rattled by Political Turmoil," The New York Times, Dec. 3, 2025.

² John Welling, "Is South Korea Crowding Your Emerging Markets Allocation?" S&P Dow Jones Indices LLC, Nov. 23, 2020.

³ World Bank, GDP Growth, Republic of Korea.

⁴ "Foreign ownership of S. Korean stocks reaches highest in nearly 6 years," The Korea Herald, Jan. 25, 2026.

⁵ Cynthia Kim, "South Korea starts 24-hour trading of dollar-won," Reuters, July 5, 2026.

⁶ Ying-Shan Lee, "South Korea ends its longest short-selling ban after systemic reforms," CNBC, March 30, 2025.

⁷ Heejin Kim and Jihoon Lee, "S. Korean President Lee vows more stock market reforms, triggering share rally," Reuters, March 18, 2026.

⁸ Nick Didio, "Choppy Chips," S&P Dow Jones Indices LLC, July 16, 2026.

The posts on this blog are opinions, not advice. Please read our Disclaimers.

Private credit has become one of the fastest-growing asset classes within global capital markets. In the first half of 2026 alone, private credit fundraising reached USD 190 billion, which is on pace to surpass the 2025 full-year total of USD 240 billion (see Exhibit 1).¹ Direct lending has driven much of private credit's growth, having multiplied roughly sixfold between 2016 and 2024.² It is now the largest segment within private credit and an increasingly important source of financing for middle-market companies in the U.S. and Europe.

However, the rapid growth of private credit has prompted increased scrutiny, reflecting concerns about the asset class's inherent opacity, volatility and valuation uncertainty. These concerns have been reinforced by recent headlines focusing on valuation practices, liquidity risk, redemption pressures and credit quality. As private credit continues to grow in scale and significance, market participants looking to understand and measure these changing dynamics need transparent and trusted benchmarks, but are often limited by lagged, manager-reported fund-level data. So, how can benchmarks keep pace and offer market participants the insights needed to effectively monitor this fast-evolving space?

Going Beyond Headline Performance

Private credit benchmarks have existed for years, but many are built on fund-level performance rather than on the underlying loans. This has created an incomplete picture of risk and volatility. Unlike public credit benchmarks that are supported by more timely and readily available data sources, reporting practices, data availability and calculation standards vary across private credit managers. The result is often a fragmented view of the market that makes constituents harder to compare and private credit more difficult to assess alongside public markets.

Closing this benchmarking gap requires richer fund- and asset-level data, along with a common framework for translating that information into standardized market measures comparable to those used in public markets. Frequent valuations and deeper data are also key for ensuring market participants have access to timelier information, which is particularly important during periods of market uncertainty when visibility becomes even more critical.

Loan-level data provides transparency into credit quality, yield, maturity profiles and portfolio concentrations across industries, seniority bands and borrower EBITDA segments. This information enables investors to better understand the underlying drivers of performance and identify evolving risks that top-line performance measures cannot.

Credible loan-level data, however, is only one part of the solution. The next generation of private credit benchmarks should combine asset-level information with consistent methodologies, trusted calculations and robust index governance. That combination creates a common reference point for evaluating performance and risk across managers, constituents and markets over time.

Building the Foundation for Better Measurement

Developing an enhanced benchmarking infrastructure increasingly requires collaboration across the private credit ecosystem. Many leading industry specialists have access to data that has historically been difficult to aggregate, while index providers contribute the methodology and governance needed to make it comparable. Together, these capabilities can help transform fragmented observations into reliable market benchmarks.

The S&P Lincoln Senior Debt Index Series, developed by S&P Dow Jones Indices (S&P DJI) in collaboration with Lincoln International, a global investment banking advisory firm, combines Lincoln's private loan valuation data with S&P DJI's transparent rules-based index methodology and governance framework. It measures illiquid senior debt facilities issued primarily to private-equity-sponsored companies in the U.S. and Europe, using granular loan-level insights to provide a systematic view of direct lending. This index series offers subscribers a rich set of credit metrics—including returns, fair value movements, yields, coupon spreads, leverage and borrower characteristics by firm size, sector and time period—that enable users to analyze how yields and spreads change over time, how risk differs between borrowers and how credit conditions vary across sectors (see Exhibit 2).

Better measurement will not erase the structural differences between private credit and public markets. It can, however, provide a clearer lens into performance, risk and market dynamics. As private credit continues to evolve, benchmarking infrastructure needs to evolve alongside it, helping the market move toward a new generation of benchmarks that offer greater transparency, comparability and possibility.

Learn more about the S&P Lincoln Senior Debt Index Series to see how we're helping market participants assess performance and risk with greater transparency.

¹ "Private Credit Fundraising H1: Market on Course for Record Year," With Intelligence by S&P Global, Aug. 12, 2026.

² Source: S&P Global, CapIQ. Data from Dec. 31, 2016, to Dec. 31, 2024, as presented in Exhibit 1 of S&P DJI's "Measuring Direct Lending: Building Transparency in Private Credit Markets," April 1, 2026.

The posts on this blog are opinions, not advice. Please read our Disclaimers.

Volatility-controlled indices (VCIs) have become a cornerstone of indexed insurance product design, helping insurers navigate volatility while maintaining exposure to growth assets. S&P Dow Jones Indices recently published the paper Indexed Insurance: Embracing Volatility-Controlled Indices in Next-Generation Products, in which we explore the growth in popularity of VCIs, their performance across market environments and their evolution. The paper also examines how volatility-control strategies have adapted to support the growing indexed insurance market and the changing needs of modern market participants. Recent market performance demonstrates how quickly risks can emerge and evolve in today's environment—highlighting the important role that VCIs may play in turbulent markets, as well as the inherent tradeoffs such strategies represent.

2025 and 2026 saw markets characterized by periods of heightened uncertainty, sharp market selloffs and rapid rebounds—all of which created a challenging backdrop for VCIs. Compared with broad equity benchmarks, VCIs generally helped mitigate drawdowns during periods of market stress, although their volatility-management frameworks also resulted in more muted participation during subsequent recoveries.

However, evaluating VCIs solely through the lens of short-term relative performance may not capture their broader role within indexed insurance products. Due to the nature of indexed insurance products, characteristics like rolling returns and rolling volatility may better reflect the potential value of VCIs as complements to benchmark indices in these products. As seen in Exhibit 2, both the S&P 500^® Daily Risk Control 15% Index and S&P 500 Dynamic Intraday TCA Index exhibited a narrower range of rolling one-year performance than the S&P 500, illustrating how a volatility-control mechanism may smooth the experience across different market environments.

A narrower distribution of rolling one-year performance suggests that the risk-control mechanisms may help reduce extreme outcomes and mitigate fat-tail risk, resulting in a more balanced performance distribution while preserving exposure to long-term equity growth. In particular, the S&P 500 Dynamic Intraday TCA Index was able to achieve higher rolling one-year performance than the S&P 500 and the traditional volatility control index.

While rolling performance highlights outcome consistency, realized volatility provides a direct measure of risk management effectiveness. As shown in Exhibit 3, both volatility-controlled indices generally maintained lower realized volatility than the S&P 500. The dynamic intraday approach further reduced realized volatility than traditional daily risk-control methods, highlighting the evolution of volatility-control technology.

VCIs can reflect the trade-off between downside protection and upside participation, but their characteristics extend beyond raw index performance. Recent market conditions have reinforced that VCIs are generally not designed to outperform in every environment. Rather, they seek to provide a more stable risk profile.

The posts on this blog are opinions, not advice. Please read our Disclaimers.

From artificial intelligence and electrification to infrastructure spending and geopolitical competition for critical minerals, metals and mining companies sit at the center of some of the most important themes of this decade. The S&P Metals & Mining Select Industry Index tracks the performance of the companies that discover, extract and process the materials powering the global economy.

The S&P Metals & Mining Select Industry Index offers a focused view of the U.S. metals and mining sector. The index selects eligible companies from across various GICS^® sub-industries, including Aluminum, Copper, Gold, Silver, Steel, Coal & Consumable Fuels and Diversified Metals & Mining. Constituents must be members of the S&P Total Market Index and meet minimum liquidity and market capitalization requirements.¹

The index rebalances quarterly, with eligible constituents being initially equally weighted, with modifications made to ensure that for a given theoretical portfolio value, each constituent's index weight cannot exceed 4.5% of the float market capitalization and the value that can be traded in three days.

Evolution of the Index

Launched on June 19, 2006, the S&P Metals & Mining Select Industry Index recently marked its 20^th anniversary. Exhibit 1 shows the index's monthly and cumulative performance over the past two decades. During this period, the index delivered an average monthly gain of 0.95%, with a positive monthly performance in 52.9% of observations.

The S&P Metals & Mining Select Industry Index's composition has changed considerably over time, reflecting both market trends and methodology updates.²

As seen in Exhibit 2, since its launch in July 2006, the index has evolved away from being a steel-heavy benchmark—Steel accounted for 49% of the index at launch, followed by Coal & Consumable Fuels at 20% and Diversified Metals & Mining and Precious Metals & Minerals at about 11%-12% each. The weight of Coal & Consumable Fuels grew significantly during the late 2000s, exceeding 30% at its peak, while the creation of the Copper sub-industry under the Metals & Mining industry resulted in the addition of Copper in 2016,³ further broadening the index's industry representation. By July 2026, the index was more balanced, with Steel (31%), Coal & Consumable Fuels (18%), Precious Metals & Minerals (18%), Diversified Metals & Mining (15%), Aluminum (9%) and Copper (5%) all representing meaningful weights, reflecting a much broader cross-section of the U.S. metals and mining industry than at launch.

Effect of Participation across Sub-Industries and Capping on Performance

Exhibit 3 shows the effects of having a more targeted focus on U.S. Metals & Mining companies: the S&P Metals & Mining Select Industry Index typically posted higher risk-adjusted performance than the broader S&P Total Market Index (TMI) Energy and S&P TMI Materials sector indices. Additionally, the S&P Metals & Mining Select Industry Index typically posted higher risk-adjusted performance than its float market cap (FMC) weighted counterpart, highlighting the potential benefit of the index's modified equal weight approach.

Conclusion

The S&P Metals & Mining Select Industry Index has evolved alongside the U.S. metals and mining industry, broadening from a structure once dominated by steel and coal producers to a more diversified mix that includes copper, aluminum, precious metals and diversified mining companies. The index's historical (risk-adjusted) performance demonstrates the effects of a more targeted focus on U.S. metals and mining companies and incorporating a modified equal weight approach.

¹ For more information, please see the S&P Select Industry Indices Methodology.

² Essential Metal Awakening - Indexology^® Blog | S&P Dow Jones Indices

Beyond the Bullion: Market Trends in Global Gold Production - Indexology Blog | S&P Dow Jones Indices

The Race for Critical Materials and the Shift to Security - Indexology Blog | S&P Dow Jones Indices

³ S&P Dow Jones Indices And MSCI Announce Further Revisions To The Global Industry Classification Standard (GICS) Structure In 2016 - Nov. 2, 2015

The posts on this blog are opinions, not advice. Please read our Disclaimers.