We've entered into this topsy turvy world where passive investors are activists and active investors are passive. It's lead to ridiculousless like the current s

We've entered into this topsy turvy world where passive investors are activists and active investors are passive. It's lead to ridiculousless like the current situation and also Aramco's contortions to bend the arm of the LSE for a new listing structure. It speaks to the incredible orthodoxy that's grown up around indexing over the last few years, much of it poorly thought out. After all, if you believe in the Efficient Market Hypothesis, then indexes pulling out of SNAP doesn't hurt SNAP, it only hurts index funds as activists will move to backfill demand. If you don't believe in EMH, then what are you doing buying index funds? Index has become such a hot word recently that it's started to lose it's meaning. Before, a fund operated something like this: 1. You pick a basket of stocks 2. You buy those stocks Now, because "passive" is so much hotter than "active", it becomes: 1. You pick a basket of stocks 2. You contract a 3rd party index provider to construct an "index" based on that basket 3. You buy that index Voila, you're now "passive" rather than "active" but all you've done is stock picking with extra steps. The markets have already responded with price signals and their signal is that voting really isn't that valuable. For all the high minded rhetoric of corporate governance, price is where the rubber hits the road and the results are pretty unambiguous. The whole point of indexing was that I didn't have to make decisions and now I have to make all sorts of decisions over which index provider I pick and what growth I'm missing out on because of arbitrary exclusions to the index. edit: As always, Matt Levine of Money Stuff says this stuff better than I ever could. Read him religiously if you want to cut through all the bullshit of finance.