Intro

Continuing our "Better with my Finance-Sis" Mini-Series, in part 2 we talk all about Funds! But not just the different types of investment funds, also the difference between Passive and Active Funds.

Passive Funds vs Active Funds

What is a passive fund?

Passive funds usually have lower expense ratios, with a more simplified investment strategy and less involvement of fund managers (or they can also be managed by computers). 

They do still follow a benchmark and aim to deliver returns with that benchmark, and are still subject to 2 important items we need to cover called: expense ratio and tracking error. 

• Tracking Error Defined:  Tracking error is a measure of how closely a portfolio follows the index to which it is benchmarked.

• Expense Ratio Defined: The expense ratio is how much of a fund's assets are used towards administrative and other operating expenses. Because an expense ratio reduces a fund's assets, it reduces the returns investors receive.

What is an active fund?

Active funds typically feature higher expense ratios, attributed to the fund manager's in-depth research, analysis, and management efforts.

Funds We Discuss:

• Money Market Funds
• Mutual Funds
• Target Date Funds
• ETFs - Exchange Traded Funds
• Fixed Income Funds

✨ Follow Jacey Saige on ⁠⁠TikTok⁠⁠ and ⁠⁠Instagram⁠⁠ ✨

✨ Follow Jess Inskip on TikTok and Instagram ✨

✨ Follow Jessie DeNuit on TikTok and Instagram ✨

Still Have More Questions or a Comment? 

🙋🏾‍♀️🙋🏻🙋🏼‍♀️🙋🏽‍♂️🙋Holla @ us on:

⁠Market MakeHer ⁠⁠website⁠⁠⁠

Get Your Free eBook: The Stock Market Explained

Support the show

Ask Us a Question, Leave a Review, Follow, Subscribe:
🔗All Market MakeHer Links
✨ Jess Inskip: ⁠TikTok⁠  ⁠Instagram⁠
✨ Jessie DeNuit: ⁠TikTok⁠  ⁠Instagram⁠
 
About Us 🌚🌞   
Market MakeHer is an investing education podcast taught by a 15-year finance expert to her friend, a beginner investor. Our mission is to demystify the stock market and make financial literacy accessible to all self-directed investors! We teach complex investing topics in a different way - from "Her" perspective.
  
Important Disclosures:
Investing involves risk. There is always potential to lose money when investing in securities. Market MakeHer LLC provides educational content and resources for informational purposes only. We are not registered financial advisors & do not provide personalized investment advice. Consult with a licensed financial advisor before making investment decisions.