Passively managed funds seek to track the performance of a benchmark index. The fees are generally lower than they are for actively managed funds, with some expense ratios as low as 0.15%. Passive funds do not trade their assets very often, unless the composition of the benchmark index changes. This results in lower costs for the fund. Passively managed funds may also have thousands of holdings, resulting in a very well-diversified fund. Since passively managed funds do not trade as much as active funds, they are not creating as much taxable income. This can be important for tax considerations.