Passive investing is an investing strategy that involves speculating on the long term value of stocks and limiting fees by buying and selling as little as possible. The opposite of a passive investor is an active investor. Passive investing is perfect for a young person (or young at heart) who doesn’t want to overcomplicate their investment choices by trying to beat the market. Investing in a diversified portfolio by using ETFs and waiting to collect the interest upon retirement is an example of passive investing. 

Go back to the encyclopedia index