Business
By Scott Ronalds Many studies on active vs. passive management draw the conclusion that the latter strategy (more commonly known as ‘indexing’) is superior because it generates higher returns. Notwithstanding the ‘sloppiness’ of some of these comparisons, it is true that many active managers underperform their benchmark. But it doesn’t have to be this way. Most active managers aren’t given a fighting chance. They are burdened by impediments such as high fees, tight constraints and a focus on short-term performance. When these issues are addressed, it’s a different ball game. In this podcast, Tom expands on the active vs. passive debate. In doing so, he sheds some light on his Globe and Mail article from last weekend, and points to a recent piece on the topic published by Morningstar. Listen now (the file may take a minute or two to download), or subscribe to our podcasts via iTunes or RSS.