Active investments have a fund manager who actively manages a portfolio of investments. They choose what investments to buy and sell.
Active investment products use professional fund managers to conduct in depth company research in order to spot opportunities and select what they believe to be the best investments for the financial aims of the portfolio.
These products generally incur higher fees than passive funds because of the costs associated with research and management.
The overall objective of actively managed investment products, is to generate higher returns than the market they are choosing investments from. An outcome passive funds, cannot achieve.
They are grouped into two distinct types: investment funds and investment trusts.