Published in:CHALLENGES TO BUSINESSES IN THE TWENTY-FIRST CENTURY: THE WAY FORWARD, W.T. Allen, R. Khurana, J. Lorsch, G. Rosenfeld, eds., 2010
Extent:
1 Online-Ressource (27 p)
Language:
English
DOI:
10.2139/ssrn.1667188
Identifier:
Origination:
Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments July 24, 2010 erstellt
Description:
Trillions of dollars are invested through index funds, exchange-traded funds, and other index derivatives. The benefits of index-linked investing are well-known, but the possible broader economic consequences are unstudied. I review research which suggests that index-linked investing is distorting stock prices and risk-return tradeoffs, which in turn may be distorting corporate investment and financing decisions, investor portfolio allocation decisions, fund manager skill assessments, and other choices and measures. These effects may intensify as index-linked investing continues to grow in popularity