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Active Fund Management |
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Active fund management An investment approach that purposely shifts funds either between asset classes (asset allocation) or between individual securities (security selection). Active Fund Management The practice of a money manager or a team of money managers making investment decisions on what securities to include in a mutual fund or portfolio. Sometimes, active management exists within certain parameters; for example, money managers may only buy blue-chip stocks for a certain fund and growth stocks for another. The basic premise of active management, however, states that the managers can maximize the return for investors by buying or selling securities on a fairly regular basis. See also: Passive management, Indexing. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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| ? Mentioned in | ? References in periodicals archive | |
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| Proponents of this
doctrine assert that markets are not sufficiently inefficient to enable
endorsement of an active fund management philosophy. It pointed out that: (1)
consumers in general did not have access to information sufficient to
identify the pension policy providers with the best performance; (2)
independent financial advisers did not always make recommendations that
benefited the consumer; and (3) active fund management did not
necessarily deliver superior investment returns. (40) The number of times funds are bought and sold, or
"churned," in active fund management, affects administrative
costs. |
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