Over the last 20 years, investor interest in passive index funds has grown substantially as a simple, tax-efficient and often cost-efficient means to achieve market-like returns with lower risk.
As practitioners of constructing multi-asset class investment portfolios, we are often asked why we would choose active strategies over passive when implementing a prescribed asset allocation. Our steadfast approach to selecting investment strategies is simple: we seek the highest return potential for a given risk tolerance at the lowest possible cost. We follow this philosophy wherever it leads, be it active or passive. Additionally, we take a long-term view that is based on deep due diligence and does not rely on past performance.
Through our collective experience in selecting managers and building portfolios, we are firm believers that there is no one-size-fits-all approach when it comes to active versus passive investing.