Daily Archives: August 1, 2013

Indexing in an Irrational Market

People assert that one of the core assumptions behind index/passive investing is that markets are rational and therefore stock prices are always accurate, reflecting all publicly (and sometimes privately) available information about a company’s prospects.  Therefore, attempts to “outsmart” the market will fail. However, it is clear that markets are not purely rational.  We cannot […]

Posted in investing, markets | Comments closed