This week, our reader wants to know whether they should change their investment strategy towards higher risk for potentially greater gain.

Carl Lamb of Almary Green responds.

Reader question:

My financial adviser has been talking to me about changing my investment strategy from using passive investments into active investments. He did explain the difference to me but on reflection I really don't understand.

Can you explain the difference please? I am cautious with my investments so am concerned that a more active investment strategy might leave me more at risk.

MORE: Ask the Expert: Does my employer still have to contribute to my pension when I've reached retirement age?Almary Green response:

This is a complicated area so do go back to your adviser before giving the go-ahead.

With active investments, the content of the fund is generally run by a manager who will buy and sell the underlying investments in the fund with the aim to beat the performance of the market when measured against specific benchmarks.

The investment managers will carry out research and use their expertise

to make decisions in an attempt to deliver better returns – or at least limit potential losses.

The cost of this service is higher because of the intervention of the fund manager.

The content of a passive investment fund, on the other hand, simply aims to track a benchmark rather than outperform it.

The important point to make is that both active and passive investments can be aligned to your risk profile so there is no reason why a change of strategy will expose you to more risk.

I can't tell you which approach would be more suitable for you without finding out all about you and all aspects of your circumstances but do get a second opinion from an alternative adviser if you are still unsure about making a change.

Both strategies can be effective, depending on a number of factors.

MORE: Ask the Expert: How can I apply for tax relief if only one of us is working?In fact, we will often adopt a strategy that uses both active and passive elements, where we feel it is suitable.

The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

Do you have a question you would like to ask our expert? Email richard.porritt@archant.co.uk or write to Ask The Expert, business desk, Prospect House.