Happy Sunday! Welcome to the 23rd edition of my weekly newsletter. Here are some of the articles and resources that caught my attention this week.
Reading
1. What Passive Investing Has Done To Our Retirement
A different perspective on passive investing in index funds.
“Green asks us to imagine walking into a rug shop where the shopkeeper offers a Persian rug for $1,000. A normal buyer might hesitate and start to walk away. The shopkeeper then says, “Okay, $500,” which entices the buyer. They perceive it as a bargain and decide to purchase. Now, imagine how a passive fund would behave in the same scenario. Green explains: “The shopkeeper says, ‘$1,000,’ and they say, ‘Okay, I’ll take it.’ Then he says, ‘No, no $1,500,’ and they say, ‘I’ll take it.’ ‘$2,500?’ ‘I’ll take it.’” This scene captures the absurdity of passive investing’s price-agnostic behavior. As Green notes, it’s not that passive funds are price insensitive. They’re actually price-responsive in the worst possible way.”
“Agentic as someone that both: Is aware of what's possible, beyond the obvious next step and Gets what they want, if that's different from what their environment wants”
Few more :
The AI-Driven Cloud Market Share Shift
Tools
Monte Carlo simulation tool provides a means to test long term expected portfolio growth and portfolio survival based on withdrawals, e.g., testing whether the portfolio can sustain the planned withdrawals required for retirement or by an endowment fund.
Things take longer to happen than you think they will, and then they happen faster than you thought they could.
-Rudiger Dornbusch