India, June 9 -- If you grew up in the 2000s, you may remember "Passive," the hit song by A Perfect Circle. The song painted passive behavior as something frustrating and inactive. Fast-forward to today, and "passive" has become one of the most popular words in investing. But thanks to Elon Musk's SpaceX IPO, many Americans are learning that so-called "passive" investment funds are not completely passive.

Passive investing means investing money in index funds or ETFs that follow a market index like the S&P 500 and keeping those investments for many years. In passive investing, fund managers do not actively pick stocks. Instead, they follow the stocks that are already included in a benchmark index, as explained by Investopedia.

Passive i...