The rise of index-tracking funds may actually be making active management harder.
Michael Burry featured in the Big Short for successfully betting against mortgage-backed securities in the run up to the financial crisis. So should we be worried that he now sees a bubble developing in passive investment?
I don’t think so. But rather than creating new opportunities for active managers, I’d argue that the rise of index-tracking funds may actually be making active management harder.
To find out why, and what that has to do with poker, please watch the video below.
Diversification can lead to better investment outcomes, and listed alternatives can help embed this principle in portfolios.