Warnings that index funds have broken the stock market all imply a threshold: a share of the market at which price discovery fails. Nobody making the argument names it. Owen Lamont, writing in the Financial Analysts Journal, argues that no such number exists short of complete passive ownership, and that what actually determines whether prices stay informative is who is left doing the trading. His case, the strongest peer-reviewed research against it, and what the performance
A poll asked Britons to choose between £50,000 for certain or a coin flip for £1 million. Nearly three quarters took the sure thing. Expected value says they were wrong. Rationality says they might be right. The real insight lies in what the choice reveals about risk — and how to make the right decisions when it matters most.
Robin Powell
Jul 297 min read
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