New Delhi, Nov. 20 -- When investing in mutual funds, investors can choose from a wide range of categories. Although the funds can range from debt to equity, large-cap to small-cap and from gold to sectoral, two broad categories of mutual funds are active and passive.

Those who are not aware, active funds are those mutual funds wherein fund manager actively manages the portfolio by keeping track of investments, whereas in the passive schemes --as the name suggests - fund managers do not have any discretionary choice. They only track other popular indices by investing in the same proportion of stocks as that particular index does.

As a result, one can imagine that active mutual funds are riskier than passive funds but offer a greater sco...