Passive investing has increased US stock volatility, study finds

The rise of passive investing is distorting price signals and pushing up the volatility of the US stock market, according to academic research.

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«Markets [have] become less efficient from the rise in passive investing,» said Valentin Haddad, associate professor of finance at UCLA Anderson School of Management.
«Markets [have] become less efficient from the rise in passive investing,» said Valentin Haddad, associate professor of finance at UCLA Anderson School of Management. (Foto: Johannes Worsøe Berg)