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
When markets look expensive, valuation anxiety pushes investors to brace for a crash. But history suggests the real risk is quieter — long stretches of disappointing real returns that erode wealth slowly, without the dramatic fall investors expect.
Robin Powell
Feb 1010 min read
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