4 ms·
Index-funds also have a huge risk: as they become too large, they become distorting how pricing of companies work: i.e. just IPO'ing gets you purchasers. At so
by conanbatt 8y ago
Index-funds also have a huge risk: as they become too large, they become distorting how pricing of companies work: i.e. just IPO'ing gets you purchasers.
At some point, the phrase "passive management > active management" will become verifiably false.
- eloff 8y agoThis. I haven't heard anybody talking about this before, but it seems like there's an unavoidable tipping point here. I wonder if we've already reached it. Rightly or wrongly I trust my stock picking over an index fund now. At least I can take responsibility for the outcome.
- conanbatt 8y agoI think just as the market will find a balance between passive/active, individual investors will most likely also find benefit in doing part passive part active.
- xal 8y agoIt takes a long time and after IPO before useful indexes pick you up.