Re:A critique of the claim that passive investing is a bubble
by rocqua on Thursday September 05, 2019 @02:36PM
(#20889541)
The high frequency traders I know of are market makers. They want to make money by buying and immediately selling stock. Earning a spread, but never having an actual position.
For them, the prospect of holding a stock that is undervalued by 10% for a few days is not good.
Other forms of algorithmic trading might still step in though.
I guess there are more legitimate concerns for funds that hold bonds or real estate or other less-liquid assets. But the solution to that is just, don’t put yourself in a position where you have to liquidate those funds in a crunch.