Active management involves monitoring the performance of an investment portfolio and making decisions about whether to buy, sell or hold and asset. It aims to ‘beat the market’ by adopting certain investing strategies and does not support the efficient market hypothesis which implies it’s not possible to ‘beat the market’ over the long run.
Passive management, known as ‘index investing’, is about mirroring a market index and is usually associated with index funds and ETFs. They help diversify you across the whole part of the market.
Whether active or passive investment outperforms the other in the long term is an ongoing debate.
Warren Buffett, the world’s most successful active value investor, recommends most people to pursue passive investing over attempting to do active investing yourself because passive investing removes the irrationality from buy/sell decisions that you’re victim to.