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You are here: Home / Archives for indexing bubble

504 Plus: Portfolio Trade, Indexing Bubble, and Money Market Capital Gains

December 14, 2024 by David Stein · Updated January 18, 2025

In Plus episode 504, David explains his recent portfolio trade to exit his AI-related ETFs and increase his allocation to non-U.S. small-cap stocks. We review Simplify ETF strategist Michael Greene's work on why he believes an indexing bubble exists. Finally, we look at how investments in short-term Treasury ETFs can lead to a capital gain depending on when they are sold. … [Read more...]

Filed Under: Money Plus Tagged With: indexing bubble, money market funds, portfolio change, taxes

504: Indexing Bubble and Asset Class Returns Still Revert to the Mean

December 11, 2024 by Camden Stein · Updated January 15, 2025

How asset class returns move in cycles with periods of above-average returns followed by periods of lower returns. How has the rise of passive indexing led to higher stock valuations, and what does that mean for markets? Show Notes The Equity Risk Premium: Nine Myths (JPM Series) by Rob Arnott—Research Affiliates The Greatest Scourge in Factorland: Revaluation Alpha = Fake Alpha (JPM Series) by Rob Arnott—Research Affiliates PASSIVE INVESTING AND THE RISE OF MEGA-FIRMS by Hao … [Read more...]

Filed Under: Podcast Tagged With: indexing, indexing bubble, mean reversion, stock market, stock market returns, U.S. stock market

390: Are BlackRock and Vanguard Too Big and Powerful?

June 8, 2022 by David Stein · Updated December 10, 2024

How big index fund and ETF providers have increased their sway over publicly-traded companies while potentially discouraging competition. What can be done about it? Topics covered include: How market share for assets under management has become increasingly concentrated with big fund complexes like Vanguard and BlackRockWhat is a fiduciary relationship and how do asset managers serve as fiduciariesWhy do investors in index funds and ETFs have no input as to how fund sponsors vote on … [Read more...]

Filed Under: Podcast Tagged With: BlackRock, climate change, ESG, fiduciary, index funds, indexing, indexing bubble, proxy votes, shareholder resolutions, Vanguard

365: Why Some Asset Bubbles Don’t Burst

November 10, 2021 by David Stein · Updated November 22, 2021

What conditions need to be in place for an asset bubble to continue and how that applies to stocks, cryptocurrency, and houses. Topics covered include: How to determine if there is an asset bubbleWhat are microbubbles and anti-bubblesHow the cannabis stock bubble burstWhat is required to sustain an asset bubbleHow the current runup in home prices differs from the housing bubble in the mid-2000sWhat structural changes have led to the high valuations for U.S. stocksWhat is the Great … [Read more...]

Filed Under: Podcast Tagged With: asset bubbles, bubbles, index funds, indexing, indexing bubble, stock market

311: Did ETFs Pass the 2020 Market Collapse Stress Test?

August 26, 2020 by David Stein · Updated April 4, 2023

How did ETFs function during the 2020 market sell-off and did the indexing bubble burst? which ETF structures failed the stress test and which passed? Topics covered include: Why were some investors, like Michael Burry, concerned about an indexing bubble What are ETF risks such as flash crashes How did equity ETFs function during the spring 2020 sell-off and how they can act as shock absorbers What were some of the challenges that bond ETFs faced in March 2020 How the rise … [Read more...]

Filed Under: Podcast Tagged With: Burry (Michael), ETFs, indexing, indexing bubble, leveraged ETF, stress test, USO

268 Plus: More on the Indexing Bubble, ETF Flash Crashes and Tax Efficiency

September 14, 2019 by David Stein · Updated April 29, 2021

In Plus episode 268 for the week of September 14, 2019 we continue our discussion on a potential indexing bubble and how indexes can push up the price of certain securities. We also look at why it is so difficult to determine what percentage of the stock market is indexed. We review what can cause a flash crash in ETF shares, including for gold ETFs. Finally, we look at the mechanism that allows ETFs to be more tax efficient than index mutual funds. … [Read more...]

Filed Under: Uncategorized Tagged With: ETFs, flash crash, gold, indexing bubble

267 Plus: Sept 2019 Portfolio Review, Indexing Bubble and Gold Miners

September 6, 2019 by David Stein · Updated April 29, 2021

In Plus episode 267 for the week of September 6, 2019 we review David's portfolio and discuss whether indexing is in a bubble. We also evaluate investing in gold miner stocks versus investing in gold. … [Read more...]

Filed Under: Uncategorized Tagged With: gold, gold miners, indexing bubble

234: Index But Don’t Herd

December 18, 2018 by David Stein · Updated June 8, 2022

How and when to use passive indexing strategies without following the crowd. Photo by Davide Ragusa In this episode you’ll learn: How big is indexing and why has it taken so long to catch on.What areas has active management done well.What are ways we can index without following the crowd. Show Notes Jeffrey Gundlach says passive investing has reached a 'mania' – investors should avoid index funds - CNBC Passive investing continues to captivate global audience - … [Read more...]

Filed Under: Podcast Tagged With: active vs passive investing, asset bubbles, Bogle (John C.), bubbles, FAANG stocks, fees, index funds, indexes, indexing, indexing bubble, passive investing

163: Is There An Indexing Bubble?

June 28, 2017 by David Stein · Updated May 27, 2021

How an indexing bubble is manifest, why most active managers underperform and how individuals can structure their own quasi index fund that outperforms the market. Photo by Sebastian Pichler In this episode you’ll learn: How popular is indexing.Why mathematically do active managers underperform.How to outperform a capitalization weighted index.How to build your own quasi index fund. Show Notes The 25 Largest Mutual Funds and ETFs - MarketWatch The Makeup of the S&P 500 … [Read more...]

Filed Under: Podcast Tagged With: active vs passive investing, bubbles, indexing, indexing bubble, passive investing, Sharpe (William F.)

MNY121 Plus: Indexing and the Use of Leverage When Investing

August 27, 2016 by David Stein · Updated May 24, 2021

This week on Money For the Rest of Us Plus we look at potential indicators for when indexing reaches a tipping point in that it has gotten too popular and active management makes more sense. We also look at the prudent use of leverage when investing including when buying a home. Finally, we review the impact on Doubleline Total Return Bond fund of the passing of one of their senior investment professionals. The episode length is 18 minutes. … [Read more...]

Filed Under: Money Plus Tagged With: indexing, indexing bubble, leverage

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