Active management is when a fund manager picks stocks, rather than aiming to match benchmark indexes. To do this, they use research, forecasts, experience and critical judgement to make investing decisions aimed at outperforming the investment benchmarks.
In contrast, there is passive management. Passive management is also known as indexing. There is more work associated with active management than there is with passive management.
ETFs are highly efficient mutual funds with low fees because investors don’t pay for active management. Instead, ETFs aim to mimic the performance of a market index, by holding the same securities in the same proportions used to calculate the market index.
ETFs practice passive fund management, instead of actively managing clients’ investments like conventional mutual funds provide (but with much higher fees). Traditional ETFs stick with this passive management—they follow the lead of the sponsor of the index. Sponsors of stock indexes do from time to time change the stocks that make up the index, but generally only when the market weighting of stocks change. They don’t attempt to pick and choose which stocks they think have the best prospects.
ETFs are like highly efficient mutual funds. Fees are low because investors don’t pay for active management.
Having a fund manager actively manage investments will always be more expensive than investing in passively managed investments.
At TSI Network, we recommend using our three-part Successful Investor philosophy:
Discover the risks and rewards of investing in Canadian ETFs, claim your FREE digital copy of Best Canadian ETFs, Canadian ETFs vs Mutual Funds, Canadian Index Funds and More now.
To determine when to buy ETFs, some investors use technical analysis and other tools. But you need to dig deeper.
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Exchange traded funds (ETFs) are set up to mirror the performance of a stock market index or subindex. They hold a more or less fixed selection of securities representing the holdings that go into calculating the index or sub-index.
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When it’s a question of ETFs vs index funds, which ones work best in your portfolio?
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Actively traded ETFs could provide investment benefits–but will more likely hurt your returns
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With all the TSX ETF investments available, it’s not too difficult to diversify your portfolio. Here’s how.
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Exchange traded funds (ETFs) tend to mirror the performance of a stock market index or subindex. They hold a more or less fixed selection of securities that represent the holdings that go into calculating the index or sub-index.
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Learn everything you need to know in 'The ETF Investor's Handbook' FREE Special Report from The Successful Investor.
ETFs Guide for Canadian Investors: Find the best way to invest in ETFs with low fees, low risk & high satisfaction.
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We are continuously in the process of improving our sites and services. If any new features or policies require a change to this current policy, we will post a clear notice of this change on pages of our site where the privacy policy appears. The principle behind this privacy policy is to collect information with your knowledge and consent.
What personal information do we collect?
The information we receive from customers helps us personalize and continually improve your online experience at TSI Network. TSI Network may collect personal information online for all legal purposes, which include, but are not limited to:
Information You Give Us: We receive and store any information you enter on our website or give us in any other way through sign-up forms or ordering forms for publications and services. You can choose not to provide certain information, but then you might not be able to take advantage of many of our services and features. We use the information that you provide for such purposes as responding to your requests, customizing your web browsing experience for you, improving our website, and communicating with you.
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We do reserve the right, however, to collect and perform statistical analyses of the internet traffic to our website for our internal use. However, information collected does not allow us to identify any individual, and will not collect any personal information of the visitor. Furthermore, we do not sell, rent or loan to any outside parties the information collected and analyzed.
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Does TSI Network Use the Information It Receives?
"Contact Us" and Comment Features: TSI Network encourages visitors to its websites to contact us with questions and comments. Email addresses and other information of persons using these features may be collected in order to facilitate our responses to those inquiries.
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We may disclose personal information you have provided through our websites, for the above purposes, to persons or companies that we retain to carry out and other activities for which you have registered or in which you have otherwise asked to participate. In particular, we may for these purposes transfer information to any country (including the USA and other countries which may not offer the same level of data protection as Canada). We also will disclose personal information if required by law, including compliance with warrants, subpoenas or other legal processes.
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Changes to this Policy
This Policy is the sole authorized statement of TSI Network's practices with respect to the collection of personal information through TSI Network's websites and the subsequent use and disclosure of such information. Any summaries of this Policy generated by third party software or otherwise (for example, in connection with the "Platform for Privacy Preferences" or "P3P") shall have no legal effect, are in no way binding upon TSI Network, shall not be relied upon in substitute for this Policy, and neither supersede nor modify this Policy.
TSI Network may revise this Policy from time to time.
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