Active or Passive?

Yes - to both!

We believe the current either/or debate to be misguided.  Our portfolios typically include both investment styles.  Active in areas where there is a competitive advantage (bonds, especially) and passive in the most watched areas (i.e. large cap US stocks).  

To invest in active managers requires the conviction that the manager can outperform* an equivalent passive benchmark after fees. It requires courage and especially patience.  We understand that even the best managers do not outperform all the time.  In fact, according to independent research conducted by both Vanguard and Morningstar, most better-than-index managers have long periods where they underperform.  Selling otherwise talented managers during periods of poor performance and buying those who are (currently) doing better is one of the biggest reasons investors fail, and how advisors fail their clients.

*Performance can be measured as either a reduction in risk or better returns, or both.