1, operation mode
Active fund refers to the operation of the fund, such as trading time, position ratio, etc. , completed jointly by fund companies and fund managers, belongs to active investment management. Active funds are highly dependent on fund managers, which is closely related to their work experience and experience.
Passive funds are generally index funds, and fund companies and fund managers do not need to make active decisions, and generally complete their operations through computer algorithms.
2. Name of the fund
Most of the fund names with index, ETF and ETF connection are passive funds, but it should be noted that most of the funds with index enhancement are active funds.
3. Investment objectives
The investment target of passive index fund is index, while the investment target of active fund is directly determined by the investment style of fund manager, so there is no fixed investment target.
4. Flexibility of position
Active funds fluctuate with the stock market, and their positions are more flexible. Generally, stock positions are between 60% and 80%, and fund managers can change positions and stocks at any time. However, passive funds usually have to maintain high position operation and cannot lighten their positions at will, so their flexibility is worse than that of active funds.
5. Transaction costs
The average annual management fee of active funds is about 1.5%, and active position adjustment will also generate corresponding transaction costs. No matter on-site or off-site, the management of passive funds is less difficult and the transaction cost is lower than that of active funds.