One cynical, but plausible, explanation is that active trading is the mutual fund manager's "raison
d'être." If an inactively traded mutual fund does well, it may be concluded that the manager's
services were superfluous; if it does poorly, the manager will be blamed for inaction. On the
other hand, if an actively traded fund does well, the manager is a hero; but, if it does poorly, it
can be said that the manager at least tried.
There is, however, an even more...