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Pisani: How to trade the index investing boom

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We all know that passive investment strategies — indexing — have been outperforming most active management strategies for some time now.

What you might not know is that the underperformance is getting worse.

The is at a historic high, yet only 14 percent of large-cap fund managers are beating the benchmark, according to Bank of America Merrill Lynch. Those fund managers have gotten the trends this year exactly the opposite of what has happened: They have overweighted health-care and consumer discretionary stocks, 2 of the 3 worst-performing sectors, and underweighted telecom, utilities and energy, which are the top three best-performing sectors.