Passive fund is a kind of fund opposite to active fund. It does not actively seek to surpass the market performance, but hopes to copy the performance of the index to achieve the same income level as the underlying index.
The most prominent characteristics of passive funds are low cost and delayed tax payment, because passive funds adopt holding strategy, do not need to exchange shares frequently, the management cost is much lower than that of funds that need active management, and the turnover rate of passive funds is very low, and the capital gains tax paid every year is very small.
Summary:
Passive fund refers to index fund, that is, fund products that invest in the constituent stocks of a specific target index and then buy all or part of the target index to form a portfolio and seek the performance of the target index.