Ask whether apparent persistence survives factor adjustment.

Family Office Private Wealth Journal · Editorial research desk · 2 November 2026

Companion to On Persistence in Mutual Fund Performance by Mark M. Carhart.

Decision in practice

A consultant selects last year’s winners and describes their gains as persistent skill.

Committee assignment

Freeze the candidate universe at the original selection date, retain closed funds, and compare subsequent net returns after accounting for common exposures.

Record and decision rule

Keep the historical shortlist. Treat an analysis that silently removes failed funds as unsuitable for selection.

Illustrative application by the editorial desk. The source authors did not evaluate or endorse this procedure.