Investing need our support as little as possible because our future wealth and future well being are dependent on it. Though we do not have enough time to monitor the market or do day trading because of the job. People who have only seen the bull market think that financial markets are easy to understand but it is not. When someone undergoes the full cycle of the market like the ups and downs of the market, then we can understand how complex the market is. And don't forget so many investment options we have in front of us which literally consume a lot of time to find out what is best for us.
And because of these reasons Mutual Fund markets are booming, the mutual funds business have grown almost 2 times which was 5 years earlier and is likely to rise once the investment sense penetrates more into the human mind. This actually means more and more individuals are putting more money into mutual funds than ever before, this is nothing but passive investing. In this type of investing, people usually spend time finding the mutual fund and then start investing in it. Though we do not have to spend too much time monitoring it but once every 6 months it's better to check how it is performing and is rebalancing needed.
Active investors are those who manage their money regularly like one doing day trading, buying and selling shares regularly etc whereas passive investors are those who do not manage the funds regularly, they do the investment through mutual funds where someone else manages the money. With more and more digitization, more and more people are doing investments whether it's active or passive. It's fine if you are an active investor, passive investor or even both as long as you are investing.
Now we need to stay active even in a passive investment world is because when people invest they invest. For example, this is my plan for a retirement fund as you can see even though I am investing as a passive investment I have to remain active so that I can rebalance and book profit at regular intervals so that I don't get surprises at the investment period.
So as you see, we need to be active in passive investment too. Either to rebalance or to change the strategy if the current strategy does not work., but whatever is the case we have to be on top of the investment to get the best out of it. We do not have to understand the complex parts, just understand enough to get good compound interest to get the maximum benefit from the investment plan made either by us or by the investment planner.
Just think about HBD investment as a Passive Investment where we get 10% Interest passively, but still, we need to claim the interest as well as we have to make a strategy on how much amount to be put on HBD savings and how much goes to the HIVE powering up. We do not do it every day but still, we have to be active to see if the plan actually works.
Being part of active investment community is a good solution
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Yes you have to be active even though you are actively investing or passively investing.
In my opinion when we look and work for passive income during the early days, it will also be ideal to stay active and manage the passive income we get. That can only help us grow faster.
That's absolutely true, we spend some time to find out what passive income works for us and then we spend minimum time to actually manage it in this way we can actually work on two things passive and active if someone wants it.
Staying active when earning passive income would make an individual to discover more and more strategies that they can use to keep earning more passive income..
That's absolutely true and those strategies will define how much you can accumulate wealth even though you are not that active.
Yeah so true
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I learn more about the future in hive, thanks again for all your brilliant analysis.
Great work and helpful article. God bless you my dear friend @codingdefined .
Thas great to know..