What is Passive Investing?
Passive Investing An investment strategy that aims to replicate the performance of a benchmark index by holding all or a representative sample of its components, rather than attempting to outperform it through active management.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Passive Investing” Used in Practice?
Passive investing has grown rapidly as investors seek low-cost exposure to broad market indices through ETFs and index funds.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Passive Investing?
An investment strategy that aims to replicate the performance of a benchmark index by holding all or a representative sample of its components, rather than attempting to outperform it through active management.
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