So I’ve been thinking a lot recently about passive investing vs. active. From the literature I’ve read and experts I’ve listened to it seems pretty incontrovertible that active money management is no better than blind luck and that consistent long term gains are to be had from putting your money in passive funds – ETFs, Vanguard etc.
I’ve also heard that the more investors pile into a particular investment style/asset class the more returns are reduced as there are more participants (I’m thinking here for example of how algo returns are lower now that it’s something ‘everyone’ can do). My question is, will this happen because more and more retail investors are piling into ETFs and passive funds? If so why? If not why?
Submitted May 24, 2018 at 05:02AM by sailingtundra https://ift.tt/2J3EokL
