Passive funds are not based on value investing principle, so there is a risk of bubble.

ETF of which country?

ETF are such that the more people invest in them, the better they perform. (Until the bubbles burst, that is.)

In the US, the active/passive split is 70:30. The share of passive funds is much lower in Malaysia.

I explained in another thread before why US index funds (passive funds) outperform active funds. See attachment.

Don't expect passive funds in other countries to perform equally. This is because the 'More money flows into index funds' step is missing.

And, in the U.S., this kind of loopback is creating a bubble.


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