Passive Portfolio Management: Meaning, Examples, Advantage, Strategies
Passive portfolio management is an investment strategy that aims to replicate the performance of a market benchmark or index, rather than trying to outperform it. Let’s find out more about it below.
What is Passive Portfolio Management?
Passive portfolio management is an investment strategy that aims to replicate the performance of a benchmark or specific market index, such as the Nifty 50, rather than trying to outperform it. There are no actively chosen stocks in this case; rather, investors use a buy-and-hold approach, usually through ETFs (exchange-traded funds) or index funds, to mirror the index’s weightings and composition. You may call it an index fund investing or ETF portfolio management strategy from this viewpoint.
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