From the article: A report this past week from investment firm Sanford C. Bernstein, titled “The Silent Road to Serfdom: Why Passive Investing Is Worse than Marxism,”
"serfdom", "Marxism"... Let me guess: Libertarian Party propagandist.
"serfdom", "Marxism"... Let me guess: Libertarian Party propagandist.
Or just someone who is well-read and likes to throw in literary references.
> Or just someone who is well-read and likes to throw in literary references.
~libertarian here: don't know him, but I'd bet he is what op thinks
With passive investing you invest in a stock because you think the company's value will grow in the future. They are building a new factory or entering a new market, etc... The added value will be represented by a higher stock price which you can sell to obtain your investment returns.
>The social function of active management, in a capitalist society, is that it seeks to direct capital to its most productive end, facilitating sustainable job creation and a rise in the aggregate standard of living.
What if an actively managed fund gives me a 10% return but a 4% fee and a passively managed fund gives me a 8% return but only a 1% fee? Wouldn't the passively managed fund be the most productive from the investors point of view?