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Conrad de Aenlle’s Funds For Thought: Who’s driving your stock investments? It may not be who you think

One of the most talked-about investment trends of recent years is the comparative shunning of actively managed stock funds, mainly mutual funds, for their passively managed equivalents, primarily exchange traded funds.

Investors yanked a net $264 billion from actively managed equity funds in 2016, according to investment researcher Morningstar, and put a net $237 billion into the stock market via ETFs and passively managed mutual funds.

That raises certain issues if you’re of a philosophical bent and want to take a break from pondering the meaning of life (or if you’ve already discovered it). If the trend toward owning stocks passively continues to its hypothetical, if absurd, conclusion and no one is left making choices to buy and sell individual issues, who will set prices and how will the market function?

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