, Columnist
‘Peak Passive’ Seems Closer, But Just How Much?
Actively managed funds await their day to shine again, but they may find less of a turn down from indexing than a plateau. Plus: Tesla’s Elon moment.
When passive investing tops out, will it be a peak or plateau? Above: Jackson Hole, Wyoming.
Photograph: Bloomberg
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If there’s been one thing to rely on over the last decade, it’s been the flow from active to passive funds, particularly exchange-traded funds and particularly in the US. Indexed investing grew steadily throughout the 1980s and 1990s, and ate into the share of traditional active managers — but the growth and popularization of ETFs has sparked an outright exodus of money from active funds: