Hey everybody this is Phil Town and this is

and this is Danielle Town and we're here for the invested podcast where we're learning how to invest like hopefully like Warren Buffett and

Charlie Munger and other phenomenal investors that we call investors in the

Rule 1 family which is all about focused investing, patients waiting for the market to fluctuate, which it always does,

and then buying a list of companies that you really understand you really like

something five to ten companies maybe to think of it as buying 20 companies in your

lifetime and Buffett said that if you do that and you get four

or five of them that are really right you are going to get rich and that's the

truth right there boils down to that simple kind of thing, but of course simple and easy those are different

I know it's like done and done. Oh wait how do I go do that now? like,

what's step number one?

Exactly.

I thought this podcast we ought to talk about passive investing since we're urging people to do active investing, to do the work, do the

homework, study hard, make your watch list, why not just passive investing right what is that well passive investing

essentially is handing your money over to someone who's not actively

managing it they're just putting it into the market in an index or which is also

known as an exchange traded fund. So those two things, index funds and exchange-traded funds.

Both are available in most people's 401k's and IRAs to be an alternative to say broad market mutual funds like a fidelity Magellan.

But wouldn't putting it into a mutual fund which is managed by a person wouldn't that also be passive on my part in

the exact same way that my buying an exchange trade of fund or an index fund would be passive on my part?

Yes, your logic is impeccable. Thank you. But one is called active invested in

the other is called passive. Really? Just buying a mutual fund is called active investing?

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