The blurring line between active and passive management

Can they still be categorized in separate buckets? And why they’re better off together

Andrew Willis 5 April, 2019 | 2:00PM

Passively managed products are coming out increasingly with active options. And actively managed products rely on increasingly sophisticated sets of passively-derived data sources. With a widening spectrum of combinations between both approaches, and an increased diversity of investment recipes, are two labels still appropriate for the marketplace of today?

Panelists at the 2019 Exchange Traded Forum earlier this week discussed how new technologies and actively selected targets are blending calculations and creativity into a continuum of investment approaches, to the extent that investors should view their portfolios with overlapping lenses and an open mind to benefit from the best of both worlds.

Passive should no longer be pitted against active, and vice versa. There is a place for both, said Michael Keaveney, Head of Investment Management for Morningstar Associates Inc. “Not only do you want both, but if you don’t have already have them in your portfolio, then you should have both.” Keaveney, was joined by panelists Robert DeRochie, Sr. Vice President and Client Portfolio Manager, Fixed Income at First Trust Portfolios and Deborah Fuhr, Managing Partner and Co-founder of ETFGI.

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
General Electric Co12.75 USD-0.62

About Author

Andrew Willis

Andrew Willis  Andrew Willis is a content editor for Morningstar.ca.