Active and Passive Portfolio Management
An investment portfolio can be managed actively or passively. Lee briefly describes what these types of investment entail and the benefits of each method for the investor.
Overview
Passive portfolio management is managing a portfolio to mimic the performance of a particular index/benchmark. Active portfolio management is managing a portfolio against a benchmark and taking active positions in order to outperform the underlying benchmark. These two methods of portfolio management are very important when trying to understand investors decision making processes.
Key learning objectives:
Define Active and Passive Portfolio Management
Identify the costs and benefits of using Passive vs Active Portfolio Management
Summary
Expert
Lee Bartholomew
Lee is the Global Head of Fixed Income Product R&D at Eurex, one of the largest derivatives exchanges in the world. Eurex is one of the largest companies within the Deutsche Boerse Group.
