What the video covers

• 0:14 Two things to compare
• 0:25 Active funds
• 0:38 Tracker funds
• 0:49 Active funds: the case for and against
• 1:03 What ten years of S&P data shows
• 1:23 Two types of tracker: passive trackers
• 1:39 Active trackers
• 1:52 An example: how and why an active tracker might change its mix
• 2:35 Passive versus active trackers
• 2:52 What the figures do and do not tell us
• 3:07 Talk to us about the right approach for you

In short

Not all trackers are passive. Most people think there are two types of fund: active funds and passive trackers. This short video explains, in plain English, how active funds, passive trackers and active trackers (officially known as tactical asset allocation) differ in cost and strategy, what ten years of S&P data shows about active funds, and, with a simple illustrative example, how and why an active tracker might change its mix.

The example is illustrative only. It shows how and why a tactical fund might change its mix, not that tactical funds get it right: they could equally get it wrong.

Related videos

• Why multi asset funds? Explained simply
• Your financial advice journey: four clear steps
• Cash flow modelling: test your plan before you live it
• The Efficient Frontier explained simply (Modern Portfolio Theory)
• All of our videos
• Our investment management service

Our services relate to certain investments whose prices are dependent on fluctuations in the financial markets beyond our control. Investments and the income from them may go down as well as up and you may get back less than the amount invested. Past performance cannot be used as a reliable prediction of future performance.