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On 1; Is there any data to suggest that inflows to index funds are pouring significantly more money into companies within an index than if people invested direc
by tybit 6y ago
On 1; Is there any data to suggest that inflows to index funds are pouring significantly more money into companies within an index than if people invested directly or with hedge funds?
- qeternity 6y agoAbsolutely. The ETF space has exploded enormously over the past decade as the Fed pumps trillions of dollars into risk assets. Having spent most of my career as a hedge fund trader, I absolutely agree with Buffet. But I think a decade of the largest monetary interventions skew the numbers massively in favor of a long only passive investor.
- fgimenez 6y agoI cannot comment on a full macro basis, but it is definitely true that being listed on an index such as S&P 500 will spike the market cap. TSLA was a recent example here. Matt Levine has an interesting piece on this (as usual) regarding trading on index inclusion as securities fraud: https://www.bloomberg.com/opinion/articles/2021-01-05/dystopian-future-securities-fraud https://www.bloomberg.com/opinion/articles/2021-01-05/dystop...