4 ms·

It's not necessarily active vs passive. It's skin in the game vs no skin. Low fee index funds offer no incentive for the managers to do any actual managing. The

• marcosdumay 10y ago
  Yes, it's not even that simple. It's about having enough skin on the game. No big fund manager has enough skin on the game. That has been true for most of last century and all of the current one, and the expected results are visibly there.
  • kolbe 10y ago
    This is why my push isn't to necessarily increase the active management profession, but instead increase the intelligence of individuals and freedom of necessary information for them to properly manage and understand their own assets. Even if they do just end up choosing to invest in a market cap weighted broad based index, it's important for them to understand how to behave with the management of those assets and to have the ability to manage them (see the distinction versus investing in index funds, because Vanguard's investors do not manage their assets). And if they do not have the requisite intelligence to manage and understand the things they own, maybe they shouldn't own them.