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In Business / High School | 2025-07-07

What is the primary drawback of a passive investment strategy?
A. Missing opportunities for higher returns during market changes
B. Increased risk of losses
C. Higher transaction costs
D. Reduced diversification

Asked by koley18

Answer (1)

The primary drawback of a passive investment strategy is the potential to miss opportunities for higher returns during market changes. While passive strategies minimize costs and risks, they do not adapt quickly to market fluctuations. This inflexibility can result in lower overall performance compared to active management. ;

Answered by GinnyAnswer | 2025-07-07

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