, Columnist
Shale Shareholders and Direct Listing
Also AlphaZero, activism, deferred tax assets and whatever price bitcoin is at now.
Should index funds be illegal?
We talk a lot around here about a theory that diversified institutional investors – index funds, other mutual funds, whatever – who own shares in multiple companies in the same industry might discourage those companies from competing aggressively with each other on price. The idea is that if you own a single, say, airline, you might want it to lower prices and take business from competing airlines: Your airline could benefit from expanding its business even as it cuts margins. But if you own shares in every airline, then that sort of competition is negative-sum: One airline takes customers from another, but no one gains customers overall, and margins decline.