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Re:A critique of the claim that passive investing is a bubble by FabHK on Thursday September 05, 2019 @12:35PM (#20888359)
> Burry made the unanswered point that in a sell-off large index funds will have to dump their smaller holdings at large discounts.

First, I think he didn't made that point very clearly. Second, why would they be sold at a larger discount than larger holdings? It is all in proportion - they own less and sell less of the smaller holdings.

(There are issues conceivable where you have a liquidity mismatch (bonds, real estate), but I haven't seen a solid elaboration of that point. It's the good old "people worry about bond market liquidity" meme that Mark Levine pokes fun at in his Bloomberg Column "Money Stuff".)

Re:A critique of the claim that passive investing is a bubble by OJFord on Thursday September 05, 2019 @12:48PM (#20888494)
> why would they be sold at a larger discount than larger holdings? It is all in proportion - they own less and sell less of the smaller holdings

His argument there AIUI was that the daily volume is not in proportion.

Re:A critique of the claim that passive investing is a bubble by FabHK on Thursday September 05, 2019 @12:56PM (#20888574)
Fair enough, so going back to a liquidity mismatch.

Will be interesting to watch the next market crash.