How to incorporate both active/passive management? | TigerDroppings.com

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Cmlsu5618
McNeese State Fan
Destin, FL
Member since Sep 2010
2192 posts

How to incorporate both active/passive management?


For the record: I am caught in between both active and passive management. Therefore, I blend my portfolio with both, focusing a majority towards active.

Right now, I have my large cap investments through load waived, A share MFs. I use ETFs for my small/mid-cap exposure as well as some of my INTL expsoure (I use OAKIX as a fair amount of INTL)

How do you choose what to employ as active and passive management?

Please save the individual stock strategies for someone who is willing to put in the REAL work in finding good companies and keeping up with them. Just wait for those bear markets to humble yourselves.







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Volvagia
LSU Fan
Baton Rouge
Member since Mar 2006
40397 posts
 Online 

re: How to incorporate both active/passive management?


I tend to active manage my small/mid cap growth stocks and passive manage the large caps.





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Cmlsu5618
McNeese State Fan
Destin, FL
Member since Sep 2010
2192 posts

re: How to incorporate both active/passive management?


quote:

Volvagia


Next?






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JPLSU1981
LSU Fan
Baton Rouge
Member since Oct 2005
17072 posts

re: How to incorporate both active/passive management?


IMO, you are over thinking it.

Just decide what you want your asset allocation to be and go from there. Asset allocation is really all that matters anyway.

If you're dead set on "diversifying" between active and passive, merely take 50% of each asset class into active and 50% of each asset class into passive. That is the simplest most straight-forward way to do it.

No offense meant (just in case you don't know), but these are the asset classes:

-large cap growth/value
-mid cap growth/value
-small cap
-international
-bonds
-real estate
-commodities



This post was edited on 7/17 at 9:20 pm


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Cmlsu5618
McNeese State Fan
Destin, FL
Member since Sep 2010
2192 posts

re: How to incorporate both active/passive management?


I don't necessarily see it as over thinking it, but just trying to use a logical process for an easy way to contribute.

I plan to roll with an allocation of all equity in my IRAs for a while until I build a certain value. I want to have a preset method for contributions so that I don't have to determine where to drop into, I focus more on things like rebalancing and funding the bastards.

I think there are interesting ways to think about active vs passive. I'd feel safe to say that, on the long run, the average American based active managers are more likely to get things right when investing here at home vs. abroad, and I'd be willing to take the index returns of whatever developed and emerging equity ETFs I get into.

The lack of a real plan is a healthy part of the reason the average investor can't beat an index.






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whodatigahbait
LSU Fan
Uptown
Member since Oct 2007
1284 posts

re: How to incorporate both active/passive management?


quote:

For the record: I am caught in between both active and passive management. Therefore, I blend my portfolio with both, focusing a majority towards active. Right now, I have my large cap investments through load waived, A share MFs. I use ETFs for my small/mid-cap exposure as well as some of my INTL expsoure (I use OAKIX as a fair amount of INTL) How do you choose what to employ as active and passive management? Please save the individual stock strategies for someone who is willing to put in the REAL work in finding good companies and keeping up with them. Just wait for those bear markets to humble yourselves.


I prefer active management on the Bond side. I want a manager buying individual bonds that are mindful of impairments and other risks ESPECIALLY in the high yield space.






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