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SFS White Papers

September 21st, 2016

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Active vs. Passive Investing

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The debate between practitioners of active and passive fund strategies has escalated, with both sides digging in their heels claiming superiority. In this whitepaper, we show that there is a place for both in a well-diversified portfolio.

Demystifying the Debate

In recent years, assets have been pouring into passive funds at the expense of their active peers. The dramatic shift in investor preference has fueled a heated debate between the peddlers of both products. Active managers insist that investors are better off placing their hard-earned money in funds that are trying to beat the market, while passive managers believe investors should be content accepting low-cost access to the market return. We would argue that both sides of this partisan debate miss the point that the best approach for many investors is somewhere between the two extremes.

At Strategic, we see a place for both active and passive management in a well-diversified investment portfolio. Our process captures the best that each approach has to offer; core assets are actively managed by our in-house investment team when possible, while passive funds are used for cost-effective diversification.

About Strategic

Founded in 1979, Strategic is a leading investment and wealth management firm managing and advising on client assets of over $1.8 billion.