active fund management

An investment approach that purposely shifts funds either between asset classes (asset allocation) or between individual securities ( security selection). Bloomberg Financial Dictionary
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Fund managers who aim to manage a portfolio such that it outperforms the market are undertaking active fund management. They aim to achieve outperformance either by selecting specific stocks which they expect to do well, or by timing their purchases of shares, i.e. aiming to buy shares just before the market rises and sell shares just before the market falls ( market timing). Fees charged by active fund managers are higher than those charged by passive fund managers. Dresdner Kleinwort Wasserstein financial glossary

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   A fund is actively managed when securities selection is based on specific ideas and research about individual companies or financial instruments. The overall composition of the fund mirrors decisions made at the micro level. It is the opposite of passive management in which a fund aims to match the performance of a market or index, and its constituents mirror the composition of that market or index.

Financial and business terms. 2012.

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