I think the fact that more and more money is being invested in index funds, and index like funds. It feels like to me in the next 10 years something has to break.
What would break in your opinion? I, like many, have 99% of my net worth in diversified index funds. When I researched the topic, I came up with the two following considerations that seems to be in agreement with the general thinking of everyone who has not a very strong interest against indexing (e.g. many portfolio managers and investment advisors):
- If everybody keeps indexing, at some point doing active trading will become so profitable that there will be a partial reversion of some indexers, so in other words it’s a self correcting feedback loop like many other economical phenomenas.
- Index funds will be nearly bullet proof _if_ the capitalistic machine that powers our domestic and global economy will continue to overall thrive, with increasing population/consumption and/or increasing productivity. This one in my opinion is the real threat, considering how horribly we are treating our natural habitat these days.
thedevindevops|7 years ago
jryan49|7 years ago
deanmoriarty|7 years ago
- If everybody keeps indexing, at some point doing active trading will become so profitable that there will be a partial reversion of some indexers, so in other words it’s a self correcting feedback loop like many other economical phenomenas.
- Index funds will be nearly bullet proof _if_ the capitalistic machine that powers our domestic and global economy will continue to overall thrive, with increasing population/consumption and/or increasing productivity. This one in my opinion is the real threat, considering how horribly we are treating our natural habitat these days.
AchieveLife|7 years ago
ohiovr|7 years ago
yesenadam|7 years ago
Spooky23|7 years ago
crypticlizard|7 years ago
savethefuture|7 years ago
babygoat|7 years ago