Which statement best describes the difference between active and passive investment management?

• A. Active strategies focus on achieving returns by tracking an index, while passive strategies seek to beat the market through security selection.
• B. Active seeks to outperform a benchmark through security selection; passive aims to match the benchmark via index replication.
• C. Active seeks to minimize costs by replicating an index.
• D. Passive strategies aim to beat the benchmark using leverage.

Answer: (B)