I’ve previously discussed ESG investing and how investing in what you view as subjective morality is actually nothing more than old school stock picking. I get it – we want [ … ]
Category: Indexing Myths
No One Knows What Individual Stocks are Actually Worth
This is probably the most important thing you can learn about allocating your savings: No one really knows what individual firms are worth at any given time. When you recognize [ … ]
5 Questions and Answers on “Passive” Investing, Part Deux
Here’s part two of the Q&A on passive investing. If you haven’t read part 1 it will be helpful to do that first since I laid out the necessary definitions [ … ]
5 Questions and Answers on “Passive” Investing
If you have read my 2012 essay on “The Myth of Passive Investing” then you probably don’t need or want to read what’s below. If there’s a consistent theme on [ … ]
Indexing isn’t Just for Quitters
* Sorry for the brief hiatus. Life got in the way and I had to take some time off. All is better now in case anyone cares. Here’s a [ … ]
The Biggest Myths in Investing, Part 4 – Indexing is Average
This is the fourth of a ten part series similar to what I did with “The Biggest Myths in Economics”. Many of these will be familiar to regular readers, but [ … ]
How Do Indexers Do Better Than Average?
One of the more common investing myths is the idea that indexing is necessarily “average”.¹ It makes sense at first. If you bought all of the stocks in the market [ … ]
Indexing is the Result of Homogeneous Markets, not the Cause
As indexing strategies gain in popularity I am seeing a common selling point from active stock picking fund managers – the idea that more indexing creates more opportunity for active managers. [ … ]
Passive Investing isn’t Hurting the Economy
The new sales pitch for the high fee active manager goes something like this: “passive investing has gotten so large that this creates greater opportunities for us to take advantage [ … ]