Active Management

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Active Management

The opposite of passive management. The passive manager simply minimizes the tracking error of their portfolio and a well known index (e.g. S&P 500 index mutual funds). The active manager will deviate from the benchmark weights by (i) varying the weights from the benchmark weights on the securities; (ii) adding securities outside the benchmark or choosing not to hold securities included in the benchmark and (iii) time-varying asset allocation where weights on certain asset classes change through time. The goal of active management is to produce a return that exceeds the passive return with minimal risk.

Active 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.
References in periodicals archive ?
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But as the market slowly pulls back into better territory, five San Fernando Valley investors are participating in the next Daily News Stock Picking Contest.
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BOX: (1) Daily News stock picking contest (see text)
Now, she's taking another step: Lyden will test her investment prowess against five other contestants in the Daily News Stock Picking Contest.
Morgan, president and chief operating officer of Interstate/Johnson Lane since 1990, also earned national recognition for his success in stock picking in 1989 by winning the Journal's monthly contest for five straight months.
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That's the lesson five investment clubs are learning halfway into the fifth Daily News Stock Picking Contest.
CHICAGO -- This stock picking strategy looks for companies trading in the upper range of their 52-week highs that have attractive fundamental attributes.
9375 in a bold attempt at regaining first place in the Daily News Stock Picking Contest.
Their approaches were OK but I was a little more aggressive in my stock picking,'' he said, meaning he did better.
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