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.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
[Re: What went wrong for Neil Woodford?] Is it really the case that Neil Woodford is now to stock-picking what Theresa May was to leadership?
In recent years, as part of Berkshire's succession plan, Berkshire has gradually shifted more of the stock-picking responsibility to Buffett's (https://www.fool.com/investing/2017/06/04/meet-warren-buffetts-2-trusted-stock-pickers.aspx) two trusted lieutenants , Ted Weschler and Todd Combs.
We remain positive on property and banks and add select consumer names to our growth-oriented stock-picking strategy, particularly if inflation concerns ease,' BDO Nomura said in a yearend research note on equities strategy.
Consider the universe of active stock-picking mutual funds.
Some stock-picking fund managers have soured on Facebook abandoning partial or complete investments in the social network since the company disclosed that millions of users' data was comprised and while some think Facebook's scandal threatens to slow user and revenue growth, many managers say the three other stocks in "FANG" remain among the market's best bets.[Reference Link]:[https://www.wsj.com/articles/some-stock-pickers-are-ready-to-drop-the-f-in-fang-1523871001]
The ratings also reflect the funds' active, long-term based investment process and bottom-up fundamental high conviction stock-picking with a growth and quality bias.
The firm largely invests money using a traditional stock-picking model.
Nelson cites a Vanguard study showing that the average large-cap mutual fund underperformed the Vanguard S&P 500 Index Fund by 1.2% a year since 1976; $10,000 invested in the fund at that time would be worth $356,276 by 2011, compared with just $226,253 in the average stock-picking active fund.
TWIN brothers must pay more than PS100,000 after allegedly defrauding investors out of huge sums of cash with a bogus stock-picking 'robot'.
19 September 2013 -- Chicago-based investment advisory firm RMB Capital said it has added to its international stock-picking capabilities by hiring Masa Hosomizu.
The processes and rules relate to stock-picking, sectoral exposure, booking of profit/loss, churning and cash holding.