Has the rise of passive investing damaged the inventory market? Is the extent of passive possession too excessive? No. There is no such thing as a sturdy purpose to imagine that greater indexing degrades market effectivity. What issues are the non-passive buyers: Are there sufficient of them, have they got the appropriate incentives, are they in a position to specific their views through buying and selling? What doesn’t matter are the passive buyers: They’re just like the viewers in a play; they simply watch the exercise on stage. There is no such thing as a stage of passive possession, aside from 100%, that clearly causes the market to be dysfunctional.