An investment approach where managers actively select securities to outperform a benchmark.
Description
Active management involves portfolio managers making discretionary decisions to buy, sell, or hold securities to beat a market index, unlike passive management’s index-tracking approach. Family offices often employ active managers for customized portfolios, leveraging research and market timing. While it offers potential for higher returns, it incurs higher fees and risks underperformance. Success depends on manager skill and market conditions.
