3. Professional Management: Properly trained professional fund managers monitor and respond to the changes in markets.
4. Diversification: Most active funds hold a large number of securities, therefore providing inherent diversification to lower risk.

1. Potential Higher Returns: Experts in money management can gain market outperformance by identifying the volatility levels and appropriate undervalued securities.
2. Flexibility: Active funds can adjust their portfolios according to the conditions of the market. Thus, they can shift into defensive positions during downturns or capitalize on emerging trends.