Passive funds, also known as tracker funds, aim to track the performance of a market index.
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The fund provider copies the index by buying and selling the same holdings as the underlying index and doesn't need to make independent decisions about what to invest in.
Advantages - This type of fund tends to have a cheaper fund management fee than active funds.
Disadvantages - Passive funds mirror the market or index, so when a market starts to decline, so too does the value of the passive fund.