TAG: Active vs. Passive
Many investors wonder if index funds’ popularity has made markets less efficient, thus improving the environment for stock-picking and market timing. While index funds have grown, the majority of dollars remain invested in actively-managed strategies.
In the 1960’s, Professor Eugene Fama of the University of Chicago coined the term “efficient market” to describe a world in which no investor can consistently beat the market without taking greater risk. Today, he’s a Nobel Prize-winner.