Fund investors must elect whether they want their money to be invested in an index fund or an actively managed fund. Which of these is preferred may depend on a variety of factors but ultimately investors desire higher returns for less risk. As a result, there is a need to analyze the performance of these two investment strategies against each other. There is ample research on the topic in the US but limited at a pan-European level. To test the performance of these funds, the raw returns, variance and market factor adjusted models (CAPM and Carhart) to compare whether European actively managed funds can demonstrate above market index level returns. The study demonstrates that the average European actively manage mutual fund can outperform their market benchmark both on a risk basis (as measured by standard deviation in returns) and raw monthly returns, even when accounting for fees. The models, however, demonstrate negative alpha,indicating below market level performance. However due to statistical inaccuracy of the model, the results are inconclusive. This outcome suggests the topic should be studied more over a greater time-period in order to accurately answer the question whether active management has value in Europe.