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How Passive HODL-ing Of Stocks Leads to Extreme Crashes | Mike Green
Forward Guidance
The Dynamic Growth of Passive Investing
When you introduced passive into the market, you created a systematic buyer that simply said, did you give me cash if so then buy? Did you ask forcash if so then sell? As that investor grows in size, as long as they're not causing tremendous distortions through index construction, that's actually a contributor to lower volatility. The problem is when that buyer becomes large enough, right, it then becomes actually a dominant feature in the market. It can cause catastrophic events. Once you cross about 25 to 30% passive, the markets begin to increase in volatility.
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