I’ve written before about how the Canada Pension Plan has transitioned from a successful passive investment strategy to a less effective method of actively picking investments. The results, as Andrew Coyne documents here in the National Post, are disastrous. The CPP spends much more than it used to and is getting far poorer results on behalf of Canadians than if it had just put the money in index funds.

As Coyne writes, “The inability of active managers to consistently beat the market is one of the most well-established principles of modern portfolio theory.” So why does the CPP keep choosing a more expensive, less effective strategy?


The views of the author are his alone and may not represent the views of PWL Capital. Any data, information and content on this blog is for information purposes only and should not be construed as an offer of advisory services. Mark Sutcliffe is not regulated by Investment Industry Regulatory Organization of Canada (IIROC), nor a member of the Canadian Investor Protection Fund (CIPF).