active management

Active management refers to an investment strategy where a manager or team makes decisions to buy, sell, or hold assets in order to outperform a specific benchmark or index. Instead of passively tracking an index, active managers analyze market trends, individual securities, and economic conditions to identify opportunities. This approach aims to achieve higher returns by leveraging expertise and research, but it often comes with higher fees and risks compared to passive management, which simply mirrors an index without attempting to outperform it.