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I think at some point we'll hit a saturation point on passively managed funds. What they're really doing is edging out the non profitable actively managed funds
by pochamago 7y ago
I think at some point we'll hit a saturation point on passively managed funds. What they're really doing is edging out the non profitable actively managed funds, and forcing managers to prove they can beat the market if they want investment. I also think we'll see more brokerages starting their own indices, which will lessen the power of any individual fund
- nitrogen 7y agoI also think we'll see more brokerages starting their own indices, which will lessen the power of any individual fund This seems to be happening with ETFs
- kccqzy 7y agoWell think of it this way. Since index funds replicate the market exactly, then the non-index funds also on average replicate the market. It's just some funds beat the market while others underperform.
- jcrben 7y agoNo. In theory we could have just two active (non-index) managers, and their average returns certainly would not replicate the market.