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By Roger Nusbaum, AdvisorShares ETF Strategist

This week's Barron's had the same argument for active portfolio management in 2014 in two different articles; the weekly interview which was with Robert Ewing from Oppenheimer and ETF Focus column.

The basic idea was that correlations are in the process of moving from very high to not so high. Ewing noted that this started in the middle of 2013. If correlations are receding then bottom up performance from companies like earnings growth, revenue growth and balance sheet management can serve to differentiate returns. Active management processes then have the opportunity to find and include the better performers in the portfolios they manage.

Compare this to a few years ago when a big complaint was the extent to which "correlations all went to 1.00" during the financial crisis creating less of a favorable backdrop for active management.

As a matter of simple logic there will be market conditions that will favor active management like 2014 based on Barron's contention and years like 2013 that favor passive management; when the S&P 500 is up 30% in a year the important thing is having equity exposure active or otherwise.

Quite obviously no one can know whether this will be the year for any particular strategy --throw in momentum, trend following, dividend growth, GARP not just active versus passive.

This is where investment discipline come into play as you define and then hone your investment strategy.

While you can go to Bogleheads to read why the most passive of index strategies is the only possible way to matter who you are or what your suitability or you can go to Seeking Alpha to read why only a fool doesn't have a dividend growth portfolio the reality is that most portfolios blend together attributes from various styles.

A diversified portfolio can be successfully constructed to include a broad based index fund which obviously adds passive to the portfolio. What about some sort of smart beta fund that screens a broad based index for some favorable attribute? That may not be indexing in its purest form but many of the funds in this niche have proven to be valid. Chances are that if you own a stock like Johnson & Johnson (JNJ) or Pepsico (PEP) then you care at least a little about dividend growth. A stock like Google (GOOG) could fit numerous investment strategies.

Do you then balance out that equity exposure with things like bonds, gold or an absolute return fund of some sort? Chances are you do and so you are incorporating parts of many styles to create the methodology that is right for your clients even if you are your only client.

To the extent a diversified portfolio contains various exposures (the ones mentioned above and any others) then one of them will be your best performer in 2014 and sure it could be the part of your portfolio devoted to active management (either stocks you choose or an actively managed fund). Where no one can know what will be the best exposure a diversified portfolio should seek to have multiple types of market segments.

Important Disclosure: This article was prepared for informational purposes only. It is not intended as investment advice, it is not a recommendation and does not constitute an offer or solicitation to purchase or sell any security.

Source: Is 2014 The Year For Active Management? Barron's Says Yes

Additional disclosure: To the extent that this content includes references to securities, those references do not constitute an offer or solicitation to buy, sell or hold such security. AdvisorShares is a sponsor of actively managed exchange-traded funds (ETFs) and holds positions in all of its ETFs. This document should not be considered investment advice and the information contain within should not be relied upon in assessing whether or not to invest in any products mentioned.Investment in securities carries a high degree of risk which may result in investors losing all of their invested capital. Please keep in mind that a company’s past financial performance, including the performance of its share price, does not guarantee future results. To learn more about the risks with actively managed ETFs visit our website AdvisorShares.com.The article has been written by Roger Nusbaum, AdvisorShares ETF Strategist. We are not receiving compensation for this article, and have no business relationship with any company whose stock is mentioned in this article.