What is the difference between passive investing & active investing ?

Everyday Money Matters is a radio show focused on answering a wide variety of personal finance issues. The show holds every Wednesday by 7.30am on 91.3 Lagos Talks FM

Question: What is the difference between passive investing and active investing  ? 

Tunji: Passive investments are those you don’t have to be involved in their day to day running. They include mutual funds and real estate.

Ugo: Passive investing could also involve handing funds to a qualified fund manager or following an index.

Question: Rebekah has a love for kids and wants to go into the sales of baby wears. How does she go about it ?

Tunji: She should learn the rudiments of the business and doesn’t need to have a shop. Rebekah should start with those around her, and then build up using referrals from them. The baby clothes industry has a wide spectrum and a huge market. There are parents who want top notch wears for their kids, and those who want affordable but decent clothing.

Question: Bola a fashion designer is torn between pursuing her business or getting an office job, as advised by her father. What should she do ?

Ugo: Bola should follow her passion, and give it a shot for a few months. If it gains traction, she can decide to follow it full time. She should however calculate the number of clothes she would need to sew to take care of her bills.

Tunji: She should come up with a business plan to convince her dad. If that fails, she can get a day job and sew on the weekends.

Question: Alozie would like to know what areas he can invest in where a gradual building process would turn into a success

Tunji: Alozie needs to have a passion for the business.