Depending on the moment, it may vary what will be more interesting to use, whether active or passive management. This seems to be the debate of recent years in asset management: active or passive management? Both have strong defenders. However, they don't have to be exclusive. On the contrary, some experts recommend using one or the other depending on the market timing and economic cycle. This is the case of the Fidelity fund manager. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original Essay The business cycle begins when the first green shoots emerge from the rubble of a slowdown or recession. These early days of optimism are usually accompanied by a strong stock market recovery as investors return to the market en masse. Risky assets, such as high-yield debt and stocks, are back in demand, while consumer-related issues, such as the information technology, industrials and financial services sectors, tend to do well. At that point in the cycle, some prices suffer more than others when markets become difficult, which means that "in the first phase of recovery there is fertile ground for active managers", explain Fidelity experts. “In this environment, value-style managers tend to emphasize, as they focus on finding companies with strong fundamentals that are not reflected in prices, and after a slowdown, these companies generally abound.” After the recovery phase, economic growth accelerates, driven by expansionary monetary policy. Markets tend to follow, driven by good times and liquidity. In a context of generalized confidence in the economic situation, according to Fidelity experts, assets generally show high correlation and low volatility and dispersion, "conditions in which passive strategies have historically stood out". With attractive and consistent returns at lower costs, "investors are less inclined to allocate money to more expensive profitability strategies, as the differences between the two are significantly reduced", explain the manager. However, you can carry out some active strategies in this market moment. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay Fidelity experts cite growth-oriented active managers, as they focus on companies with solid, quantifiable plans to harness economic strength; Income and dividend strategies can also be attractive, especially in low interest rate environments. Additionally, active management strategies are useful at this point in the cycle for creating a diversified portfolio, as there are some strategies that are not accessible with a passive approach. Among these assets, Fidelity cites high-yield bonds, emerging market debt and inflation-linked bonds. Additionally, fixed income index funds are usually weighted by the market value of outstanding bonds, which results in a greater detriment to more indebted issuers.