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comment by ooli
ooli  ·  42 days ago  ·  link  ·    ·  parent  ·  post: Ben Carlson: Debunking the Silly “Passive is a Bubble” Myth

Ok it says equity ETF are bad because the long equity bias might come crashing down !

Which make little sense to worry about . If the market crash down, every active fund are fucked too. May be their beta is a little less correlated to the market than ETF, but we're talking peanuts




kleinbl00  ·  41 days ago  ·  link  ·  

Fundamental value theory states that a stock is worth the future value times the odds of it going up divided by the odds of it going down minus the value of the starting investment in a risk-free vehicle.

Castle in the air theory holds that a stock is worth what you can sell it for.

Fundamental value theory has been out of vogue for twenty years. WeWork is worth $47b because you'll be able to sell it for $80b in another couple years (right? right!).

ETFs are the way to go because everybody knows that ETFs are what you want to buy. Until ETFs are what you want to sell and suddenly, ETFs aren't worth as much.

kleinbl00  ·  40 days ago  ·  link  ·  

BAM

WeWork is suddenly worth $20b.