Active versus passive investment styles The “couch potato” portfolio is so named because it takes a “passive” approach to investing. It is predicated on the theory that markets are efficient, or smarter, than any single person. Studies have shown that the passive,...
Knowing which is which could affect your bottom line “Active” and “passive” portfolio management used to be fairly straightforward. Active managers traded frequently in an effort to beat the market, while passive managers relied on index-following strategies. But...
Active versus passive investment styles A friend of mine says she invests in a “couch potato portfolio,” and her returns are higher than my portfolio of mutual funds, which the company says is actively managed! I’m not sure I understand what a “couch potato”...