What is Active and Continuous Management?

By definition, active and continuous management means the advisor is overseeing accounts with regular and ongoing supervision. It also means the accounts will hold investments at any given time that the advisor feels appropriate to the investment conditions and the needs of the client.

We believe that traditional brokers utilize passive investment strategies. These are intended for a long time horizon. Statistically, over long periods of time, we have found that this has proven to be a successful strategy. If the investor has decades before needing to access his or her money, it may be an appropriate alternative.

However, if the account being managed is large or the time horizon is not decades long, the investor may want the added value of someone making timely decisions on their behalf. If the stock market is in a bear market phase, the investor might prefer to go to sleep at night knowing someone is actively managing their account daily. They also may like knowing that changes are being made, as deemed necessary, to attempt to avoid large declines and to actively participate in market rallies. Moreover, many investors do not want to pick their own investment allocations. They would like a professional to do so on their behalf, and on an ongoing basis.

The brokers who do try to provide active management styles often solicit funds from the client and then place the assets with third party managers. In this circumstance the investor is paying an advisor for asset management and a broker to solicit his account. The third party asset manager also has investment fees that may be absorbed by the client.