MAYZ - Whitepaper V2
  • INTRODUCTION
    • What is MAYZ?
    • Why MAYZ?
    • How Does MAYZ Work?
      • Types of Members
      • Fund Creation Process
      • Escrow Service
    • Protocol Path
      • MVP
      • Release 1: Full Cardano
      • Release 2: Cross-Chain Goal
    • Token Types
      • MAYZ Utility & Governance Token
      • Fund Token
    • Tokenomics
      • Total Distribution
      • Vesting Schedule
  • MAYZ PROTOCOL
    • Technical Document
      • General Aspects
        • Mutual Funds
        • Liquidity Pools
      • Purpose of MAYZ Protocol
      • MAYZ Holders Community
      • Protocol Contract
        • Definition
        • Functioning
      • Fund Contract
        • Definition
        • Functioning
      • ADA/LP Swap Contract
        • Definition
        • Operation
      • Escrow Agreement
        • Definition
        • Operation
      • Investment Unit, LP and uLP Token
        • Definition
        • Decimals and fractions
        • Recommendations
        • ADA in the Investment Unit
        • Investment Unit, LP Token and uLP Token Value
      • Deposits in the Fund
      • Withdrawals from the Fund
      • Fund Re-Indexing
      • Commissions
        • Payment of Commissions
        • Charging Commissions
        • Recovering Fees
      • UTxOs of Deposits in the Fund
      • Oracle Contract
  • Cardano Fund
    • What is Cardano Fund?
      • Cardano Fund
      • Passive Investment Strategy
    • Why Cardano Fund?
      • Cardano Fund Vision
    • How Does the Cardano Fund Work?
      • Spects
      • Where to Start
  • MAYZ
    • Development Roadmap
    • Meet the Team
    • Funding Strategy
    • ISPO
    • Knowledge Base
      • Why Cardano?
      • What is a smart contract?
      • What is an Index?
      • What Is a Blockchain Oracle?
      • What is a Cross-Chain Bridge?
  • Links
    • Website
    • Twitter
    • Discord
    • Medium
  • BRAND KIT
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  1. Cardano Fund
  2. What is Cardano Fund?

Passive Investment Strategy

In traditional finance, a known investment strategy called buy-and-hold is the opposite of more active strategies based on technical analysis and frequent trading.

Active strategies seek to profit from short-term price fluctuations or market timing, trying to beat the market. Beating the market means getting a greater return than the market as a whole.

Numerous academic studies show that it is impossible to beat the market systematically when particular market efficiencies are met. Other more descriptive studies show that neither the most successful hedge fund beat the market systematically.

So most investment strategies are passive, which means that instead of beating the market, the goal is to follow it, to replicate the whole market as accurately as possible. PIS tries to match the market or sector performance, and passive investing attempts to replicate market performance by constructing well-diversified portfolios of single assets.

Its introduction in the 1970s made achieving returns in line with the market much more straightforward. In the 1990s, exchange-traded funds, or ETFs that track major indices, such as the SPDR S&P 500 ETF (SPY), simplified the process by allowing investors to trade index funds as though they were stocks.

To see more about this subject, we recommend reading this bibliography: A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing - Burton G. Malkiel (Author)

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Last updated 2 years ago