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The amazing rise of passive and what you need to do about it (Ep-21)

Capitalmind Podcast

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What Should an Index Fund Manager Vote For?

If you have a market cap weighted thing that means I will always buy reliance because the top market cap if reliance falls out of grace then you will sell reliance and buy something else. Now the top stock of the index in every decade has been different. So it has actually shifted the top set of stocks have shifted over the years. Some of them have gone out of the index temporarily and come back. And therefore momentum is with those stocks it builds momentum you continue to buy or buy more as more money comes into index fund. But at some point if the active managers become a tiny percentage maybe 10, 15%, versus 85% is passive managers. That means I don't care about fundamentals. Exactly

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