Should you choose active or passive share investments?
Sunday 11 July 2004
When comparing actively managed and passively managed NZ share funds it is always a challenge to judge whether the "active" management is likely to add enough value to make it worthwhile. These two types of funds each have distinctive advantages and disadvantages.
By The LandlordThe reasons for investing in a passive fund is quite different for the reason you would invest in an active fund, and like all investing decisions what is the best choice depends on the needs of the individual investor.
There are many aspects to an active fund that you should consider before you invest, such as the degree of "activeness", the manager's abilities, the investing style and the rules that determine what the fund can and can't invest in.
The benefits of passive funds are the typically lower fees and the fact that they may pay less in tax if they don't have to pay tax on capital gains.
While paying less in fees and taxes will certainly enhance net returns, it is important to note that an active fund has the opportunity to actually outperform the index, while the passive fund does not.
Read More - Opens in a new window
Commenting is closed
Proving tenant liability for damage has long been a major worry for landlords but a recent Tenancy Tribunal shows that it can be done.
Vacancy rates in the commercial property sector are set to increase as changing economic conditions dampen demand.
LVR restrictions were never meant to be a permanent feature of New Zealand’s housing market and ANZ economists argue that some further relaxing of them could soon be on the cards.