Is it worth investing in actively managed funds?

Posted by TEBI on August 24, 2023

Is it worth investing in actively managed funds?



Getting Started is our video series aimed at first-time investors, featuring JONATHAN HOLLOW. This time, we look at whether it is worth any investors’ while to try their hand at investing in actively managed funds.




 If you want to keep your fees as low as you can and you are happy getting the average return for the market you are investing in, then you definitely should invest in passive funds rather than active funds. Now, if you think you found an active fund manager who really is superior at picking shares and companies and can beat the market, you can have a go at that and invest in active funds.

But as Robin Powell and I show in our book How to Fund the Life you Want, star active fund managers tend to enjoy a streak of luck only for a few years, and then their performance will either revert to the market average or, worse, go below it.



JONATHAN HOLLOW worked for the UK Government’s Money and Pensions Service and is a writer and commentator on consumer education and protection. He is the co-author, with Robin Powell, of the award-winning book How to Fund the Life You Want, which is published by Bloomsbury.



What’s the difference between active and passive funds?

What are the fees and charges you need to know about?

How to invest tax efficiently?



It’s not essential nowadays to seek professional financial advice before you start to invest, but it is definitely a good idea to do so. We also recommend that everyone has a financial plan.

If you would like us to put you in touch with a financial planner in your area, who shares our evidence-based investment philosophy, just click here and send us your email address, and we’ll see if we can help.


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