1. investment style and concept: different financial professionals and investors may have different investment concepts and styles. Active fund managers usually try to achieve market excess returns by selecting individual stocks, market timing and research, while index funds aim to track market indexes and provide average market performance. Some people are more inclined to believe that active management can beat the market, while others are more inclined to accept market performance.
2. Cost: Index funds usually have lower management costs because they don't need active research and trading to select stocks. Active funds usually have higher management fees because they need to pay the salaries of professional managers and other research and transaction costs. Index funds may be more attractive to investors who pursue low-cost investments.
3. Historical performance: Some active funds performed well in the past and successfully achieved market excess returns. However, past performance does not always predict future performance, so investors need to be cautious about this. Index funds provide relatively stable and predictable market performance.
4. Risk preference: Investors have different risk preferences. Some people are willing to take more risks and hope to get higher returns, while others prefer conservative investment strategies and hope to reduce risks. According to personal risk preference, individuals may prefer active funds or index funds.
5. Investment objectives: Investors' objectives will also affect their choices. If someone's goal is to invest for a long time and accumulate wealth, then index funds may be more suitable because they provide a widely dispersed portfolio. If someone pays more attention to short-term market fluctuations and tries to tap opportunities in the market, then active funds may be more suitable.