Active Management Definition
Learn the definition of active management and other ETF terminology from the etf.com glossary.
Learn more about Active Management
An actively managed ETF is an exchange-traded fund that has a portfolio manager who makes decisions about which securities to buy and sell. This differs from passively managed ETFs, which simply track a particular benchmark index or asset. Actively managed ETFs can be more expensive than passively managed ETFs, but they also have the potential to outperform the market. Actively managed ETFs are a good option for investors who are looking for a more hands-off approach to investing. They can also be a good choice for investors who believe that a professional portfolio manager can beat the market. However, it is important to remember that past performance is not necessarily indicative of future results.
Related Terms
Passive Management, Nontransparent Active ETF, Alpha, Smart Beta ETF
