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Eric Balchunas

5 Ways ‘Passive’ Investing Is Actually Quite Active

No one’s leaving the decision-making to the robots.
Love that human touch.

Love that human touch.

Photograph: Fox Photos/Getty Images

Rise of the machines! Attack of the clones!

This is a common outcry from the financial industry and investors alike in reaction to the rapid rise of “passive” index funds and exchange-traded funds, which now have about $5 trillion in assets in the United States. Investors have an understandable tendency to see passive investing as a bunch of robotic investors putting money into robotic funds run by robots.