The shoeshine boy moment, is less about everyone wanting to invest, more that if I talk to people about investing, lots of them already know about passive diversified tracker being the 'best way to do it'.
Financial history/common sense indicate that anytime an edge was discovered, money chased it until the edge didn't exist. And while index tracking gives the market returns by definition, it has been delivering the edge of ensuring top percentile returns in a given market over the long term.
There are already threads about longest bull run in US, and the cheapness of other markets already active on aam, so I think that covers the 1. part.
I'd like to limit this thread to the market inefficiency concerns.
I can imagine this is a hot question for researchers, and I haven't seen a definitive convincing answer from casual reading, but I haven't had enough time to research this space - hence the question.
There are already threads about longest bull run in US, and the cheapness of other markets already active on aam, so I think that covers the 1. part.
I'd like to limit this thread to the market inefficiency concerns.
The total market capitalisation of s&p500
In 1957 it was 0.17 trillion
1980 1 trillion
Today 20 trillion
The question is: is it justified?
The total market capitalisation of s&p500
In 1957 it was 0.17 trillion
1980 1 trillion
Today 20 trillion
This is to look at just one issue around valuation. Questions of profitability and future prospects are far more important, although harder to quantify.
So long as the basic concept of benchmarking continues to be the accepted measurement of performance, index investing will continue on its merry way regardless of the underlying fundamentals.
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?