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Are Index Funds worse than Marxism?

2021-04-06 16:33:40.268042+00 by Dan Lyke 0 comments

A lot of people are starting to realize that even though most stock picking is just gambling, index funds are a different sort of centrally planned economy: Could Index Funds Be ‘Worse Than Marxism’?

With index funds, nobody’s behind the scenes, dumping bad investments and selecting good ones. Nobody’s making a bet on shorting Tesla or going long on Apple. Nobody’s hedging Europe and plowing money into Vietnam. Nobody is doing much of anything at all. These funds are “passively managed,” in investor-speak. They generally buy and sell stocks when those stocks enter or exit indices, such as the S&P 500, and size their holdings according to metrics such as market value. Index funds mirror the market, in other words, rather than trying to pick winners and losers within it.

Even ignoring the large centralized economy issues, there's the fact that this trend also creates small more volatile side-markets. the MeFi thread has a lot more good links and comments...

[ related topics: Apple Computer Currency Gambling Economics ]

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