passive management fund is the opposite of active management fund. Passive management funds don't think that fund performance can surpass the broader market, and the idea of "if you can't beat it, copy it" arises spontaneously. Index fund is the representative of passive management, and the popular ETF in recent years is operated by completely passive management.

passive management believes in the efficient market hypothesis, and believes that the securities market has fully reflected all the information, so it is better to be still. Unlike active management funds, which actively operate portfolios, passive management funds choose to copy the market index, and in order to be as close as possible to the market, unless the tracked index components change, fund managers will not frequently enter and exit the market.

because the investment portfolio of passive management funds rarely changes, the securities brokerage fees that the funds need to pay will be much less than those of active management funds, which also makes the fund management fees of passive management funds cheaper than those of active management funds, which is another feature of passive management funds to attract investors.