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 ?
Broadridge's data showed that half of actively managed institutional funds assets came from retail channels: registered investment advisors, broker-dealers and online.
But in late November, Vanguard stepped partially out of its well-established comfort zone and jumped on the actively managed ETF bandwagon here in the U.
The proposed structure would allow market makers to effectively hedge their exposures and maintain reasonable bid/ask spreads for the ETF, while at the same time, mitigate the risk of front-running and free riding that could be detrimental to an actively managed ETF and its investors.
Five actively managed exchange-traded funds (ETFs) sponsored by AdvisorShares, AdvisorShares Pacific Asset Enhanced Floating Rate ETF (NYSE MKT:FLRT); AdvisorShares Madrona Global Bond ETF (NYSEArca:FWDB); AdvisorShares Sage Core Reserves ETF (NYSE MKT:HOLD); AdvisorShares Peritus High Yield ETF (NYSEArca:HYLD); and AdvisorShares Newfleet Multi-Sector Income ETF (NYSE MKT:MINC), on Monday revealed income distributions for August 2017.
Advisors invested client assets in actively managed funds in the first half of 2017, but net new flows were driven entirely by low fee and institutional priced share classes, according to data released today by Broadridge Financial Solutions, Inc.
Retirement plan committees are increasingly selecting passively managed funds for their 401(k) plan investment menus, in many instances to replace actively managed funds.
Summary paragraph: Let's clear up any confusion about actively managed funds
NextShares are a way to invest in actively managed strategies.
One of the key investment debates concerns the benefits of using either an actively managed fund overseen by a specialist manager, or a passive fund that simply tracks one of the major indexes such as the FTSE.
Bank of America (NYSE: BAC) is to provide greater access to Actively Managed Investments through a new product.
The new solution allows assets to be actively managed by the company on a single integrated platform.
Man Investments has launched a new global product which aims to offer investors access to a selection of industry-leading directional investment managers, combined in an actively managed and flexible portfolio.