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Investing: Active vs Passive - Coggle Diagram
Investing: Active vs Passive
Active Process
Monitor price of position by researching or analysis
Out-performing benchmarks/Alpha Return
Higher Fees
Inefficient Market
Passive Process
Little to no research
Buy as soon as they have the money too
Diversifying/Mimic Benchmark
Lower fees
Efficient Market Hypothesis
Index Funds
Mirror the Market
Get a decent portfolio
Mutual Funds
Long Track Record
Outperform the market/SMP500
International
International Companies
Global Fund
Works better than International funds
Growth and Income
Large Capitalization Fund/Blue Chip
Most stable/boring/large campanies/ goes slow
Growth
Miidcap fund/SMP500/does what the market wants
Aggressive Growth
Small Cap/crazier mix/moves fast/merging market