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 ?
In addition to the overall award, seven Banc of America Securities equity research analysts received industry earnings estimates awards, five analysts were given industry stock-picking awards and one analyst received an overall stock-picking award.
Five months after it began, the Sixth Semi-Annual Daily News Stock-Picking Contest concluded with a mad flurry of buy and sell orders from the top three day traders, er, participants.
Many people seem to believe there are some "magic numbers" out there that equate to stock-picking success.
Zulawski's payoff: $260,000 in the fictional stock-picking contest and $52,000 in a real paper profit on his personal account.
Morgan, president of Interstate/Johnson Lane (NYSE: IS), a regional brokerage firm headquartered here, has won the Super Bowl of stock-picking contests for a second consecutive year.
But by backtesting a stock-picking strategy to see if your stocks typically go up as soon as they're identified, you can buy less time and closer-to-the-money options.
One of the main components in this week's stock-picking strategy focuses on Cash Flows (and increasing Cash Flows).
The Wall Street Journal rankings are based solely on stock-picking ability, recognizing the analysts whose recommendations generated the best returns during 2004.
When it comes to his true investments - those independent of his work - Broad's aversion to direct stock-picking comes through.
Award-winning analysts were ranked in The Best on the Street survey based solely on their stock-picking skill.
have been recognized for their stock-picking skill in the Forbes.