Using Active and Passive Funds for Investment Success

Morningstar UK: Podcasts

This month we focus on how to invest using active and passive funds.

Fans of passive investment often cite the cost of active management as a negative factor. But smart investors should consider more than just the price of a fund. Morningstar Editor Emma Wall speaks with Chris Traulsen, Head of Research for Morningstar on what else to look out for when choosing a fund other than its price.

Predicting how much a fund investment costs – whether it is active or passive – is near impossible says Emma Wall. Should flat fees become an option for the future?

With passive funds often performing just as well as actively managed funds at a fraction of the cost, why pay for active management? Active management is critically important for a functioning economy - as well as investors, says Mark Burgess from Columbia Threadneedle. Especially when stock markets are expected to move sideways.

Passive funds are precise tools that asset allocators can use to get exposure to different markets - although they are not risk free. So what are the benefits of passive investing? Emma Wall and Chief investment officer for Nutmeg, Shaun Port discuss this next.

Want to invest in UK equities? Once you have decided on the asset allocation, now it is time to choose which strategy is best to gain exposure. European Website Manager for Morningstar, Holly Cook, talks us through some options.

A healthy level of scepticism is required before appointing any active fund manager, and you should have a high degree of confidence that that manager can outperform any fees. Is balancing active and passive funds the way forward? Chief Investment officer for Morningstar’s Investment Management, Daniel Needham talks about using Active and Passive Strategies within a retirement portfolio.