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
The fifth anniversary of the closure of the Woodford Equity Income Fund (WEIF) is two weeks away. More than 300,000 investors were affected by WEIF’s implosion. Some of them planned to retire by now but are still having to work to recoup the money they lost. Many died without receiving any compensation. You would hope by now the financial industry would have learned the lessons of this sorry saga. Alas I fear it hasn’t, and, five years on, the chance of a recurrence has never
Robin Powell
Jan 5, 20254 min read
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