It's important to understand the difference between active and passive investing, and why we actively manage investments at Round.
Passive investing means investing in a static, never changing portfolio.
This means that generally you will have the same investments in your portfolio, no matter what happens in the world around you.
These passive portfolios are typically made up of generic stocks and bonds and aim to mimic the financial markets. This means that generally if the market is up, your portfolio will be up and if the market is down, your portfolio will be down.
There can be years of strong markets, like we've seen for the past few years, that makes it appealing to invest passively. When everything goes up, you don't need to do much but ride the rising tide, right?
It's not a bad way to invest, but you have to be mentally strong enough to go through the ups and downs over time.
Simply put, with passive investing there is no management of your investments of any kind—you are just the passenger along for the ride.
Active investing means being active in the investment process and having a say in where and when you invest. This is what we do at Round.
Our team of dedicated professionals makes investment decisions and manages your portfolio, while constantly monitoring the financial markets for you every single day.
Our investment objective sets us apart—achieving the best 'risk-adjusted return.'
This means that our investment team manages your portfolio with a focus on reducing risk and getting the best return possible. Most ultra-wealthy individuals and large institutions invest their money this way.
The general idea is to preserve the amount of money you invested, and maximize your return.
This is important if you are looking to invest a big chunk of your life savings. You don't want to gamble with a significant amount of your wealth, but you still want to get the best return possible.