The Benefits of Active Management: The Power of Choice


Active + Passive: A Natural Pair

Active and passive, though often talked about as opposites, are in some ways quite complementary. Consider the limitations inherent in index strategies. They provide broad market exposure, but leave investors exposed to the possibility of price declines. And as we’ve seen since the financial crisis, big changes in the macro environment can introduce unexpected concentration risks in traditional benchmarks.

Active strategies, on the other hand, are well placed to address these issues. In declining markets, they may reallocate assets away from risk, and can make adjustments when the macro environment appears uncertain.  What’s more, they can take advantage of short-term mispricing to generate incremental gains.  

Given their complementary traits, a portfolio that combines active and passive offers tantalizing possibilities.  The key is to find a balance that reflects an investor’s goals and which leverages the strengths of both approaches. In addition, it’s important that the active strategies selected are truly active – that they differ significantly from available index strategies – or the investor won’t reap the potential benefit of diversifying between the two styles. 

 

The Choice is Yours

Legg Mason’s diverse line-up of investment managers can help you pursue your goals with active strategies designed to address a wide range of needs.  From traditional equity and core bond funds to unconstrained and multi-asset solutions, we provide a level of choice that few other asset managers can match.  Whether you are an investor or a financial professional, check the links below to learn more about how we can make active work for you and your portfolio.


featured products

ClearBridge Large Cap Growth Fund

Western Asset Core Plus Bond Fund

Western Asset Total Return Unconstrained Fund


Featured Resources

Date Title Description
April 10, 2017 Investment Idea - ClearBridge Large Cap Growth - Let's Get Active Why investors should consider the actively managed Large Cap Growth Fund.
February 22, 2017 Investment Idea - Western Asset Core Plus Bond - Let's Get Active Why investors should consider the actively managed Core Plus Bond Fund.
April 25, 2017 Investment Idea - Western Asset Total Return Unconstrained Fund Insight on why investors should turn to the Western Asset Total Return Unconstrained Fund.
September 21, 2016 Dare to be Different - Active Share A brief look at the concept of active share -- what it is, what it is not, and what it says about how a portfolio is managed

All investments involve risk, including loss of principal. Past performance is no guarantee of future results.

The information provided on this webpage is not a recommendation or an offer to buy or sell any security.  Illustrations are provided as alternative solutions for consideration by financial professionals and their clients only and are based on QS' proprietary outlook which takes into account certain general investment objectives, modern portfolio theory and market indicators. The hypothetical portfolios discussed are not available for investment. Legg Mason does not make recommendations or conduct suitability analysis. All investment decisions are that of the client and his/her Financial Advisor.