to diversity risk, and it encourages capital formation. Active management also plays an important role in capital formation, because actively-managed portfolios are the buyers of initial public offerings of securities. See also Investment management Index fund Passive management Magellan Fund Active risk Investment style References Further reading Burton G. Malkiel, A Random Walk Down Wall Street, W. W. Norton, 1996, John Bogle, Bogle on Mutual Funds: New Perspectives for the Intelligent Investor, Dell, 1994, Mark T. Hebner, Index Funds: The 12-Step Program for Active Investors, IFA Publishing, 2007, External links The Experts: When Does Active Management Make Sense? Article: Do Active Mutual Fund Managers Have An Inherent Conflict of Interest? The Arithmetic of Active Management, where William F. Sharpe demonstrates that passive management will always outperform active management on average. National Association of Active Investment Managers Proactive Advisor Magazine Investment management