This article was originally published in the Q2 2022 edition of  Blue Chip Journal.

The discussion around passive versus active is an ever-evolving debate that for some has come to the point of “agree to disagree”. Unfortunately, many market participants see all non-actively managed investments as passive.

At MitonOptimal, we see indexation as the use of passive building blocks to create a fund or portfolio with a specific mandate or outcome in mind. This includes Active Beta, Smart Beta, Themed Indexation, Factor Indexation and many more. Within these strategies a wide variety of nuances play into the end outcome for the client and the generalisation of “concentrated index exposure” no longer applies. Using “active share” as a measure of differentiation, most of these strategies vary greatly from the index and in some cases even more than active asset managers.

It is also possible to build an active portfolio using exchange-traded funds (ETFs), exchange-traded notes (ETNs) and other asset class building blocks without having to make calls on any stock-specific outcomes. MitonOptimal are strong proponents of indexation and have been successfully implementing these strategies within our Core Indexation Portfolios, Tailored Portfolios and Funds for over a decade.

Jacques De Kock

Jacques De Kock

Quantitative Analyst and Portfolio Manager



To learn more about our Indexation capabilities, please visit our Indexation Solutions page here.


The content of this article is for information purposes only and does not constitute an offer or invitation to any person. The opinions expressed are subject to change and are not to be interpreted as investment advice. You should consult an adviser who will be able to provide appropriate advice that is based on your specific needs and circumstances. The information and opinions contained herein have been compiled or arrived at from sources believed to be reliable and given in good faith, but no representation is made as to their accuracy, completeness or correctness. MitonOptimal South Africa (Pty) Limited is an Authorised Financial Services Provider Licence No. 28160, regulated by the Financial Sector Conduct Authority (FSCA) – Registration No. 2005/032750/07.MitonOptimal Portfolio Management (Pty) Limited is an Authorised Financial Services Provider Licence No. 734, regulated by the FSCA – Registration No. 2000/000717/07.

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