Commentary

Second Quarter 2026 Active Equity Allocation Report

Fidelity's quarterly active equity allocation analysis.

Key Takeaways

The number of positive indicators for U.S. active management increased in Q1 2026, with monthly return dispersion and stock-level return correlation reaching their most favorable conditions in almost four years at the end of February, before each turned more negative in March, driven by the conflict with Iran.
The increased market volatility tied to the Middle East and the corresponding rise in energy prices raised the risk of more-challenging conditions for return dispersion and stock-level return correlation in Q2—and possibly beyond if the conflict were to continue.
All the major U.S. indexes we track for this analysis reflected more positive than negative indicators in Q1.
Conversely, the MSCI EAFE and MSCI EM Indexes each experienced declines in the variation caused by specific risk compared with Q1, and predominantly negative indicators overall.

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Second Quarter 2026 Active Equity Allocation Report

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