Navigating Active vs. Passive Investing

This chapter examines the competitive dynamics between active and passive investment strategies, particularly focusing on the concentration of major tech stocks in active managers' portfolios. It explores the structural implications of major stock indices and the historical impact of low-cost investing options introduced by firms like Vanguard. Furthermore, the discussion addresses the complexities of market behavior influenced by passive investing, including its effects on volatility, trading activity, and stock selection processes.