Passive Flows Have Derailed Fundamental Investing: Here is What It Means for Investors | Mike Green

In this episode, we are joined by Simplify Asset Management's Mike Green. We build on our previous episodes with Mike where we discussed his research on the impact of passive investing on the market and focus on its practical implications and how it impacts how investors construct their portfolios. We discuss the types of equity strategies that would benefit the most from the rise of passive, whether a factor could be constructed based on Mike's research, different strategies that might hedge a potential market decline triggered by passive and a lot more. 00:00:00 - Intro 00:01:47 - Summary of Mike's work on passive investing 00:05:43 - Discussion of practical implications for individual investors 00:08:17 - Analysis of portfolio protection strategies and hedging 00:11:37 - Discussion of creating a factor-based approach to passive flows 00:15:38 - Explanation of market elasticity and Haddad's research 00:21:31 - Discussion of passive investing becoming a monopoly 00:24:41 - Analysis of portfolio diversification beyond stocks and bonds 00:28:06 - Examination of passive's impact on bond markets 00:31:26 - Discussion of potential warning signs and end game scenarios 00:35:16 - Analysis of whether a bear market could change passive dynamics 00:38:37 - Discussion of returning to fundamentals-based investing 00:42:36 - Analysis of regulatory changes and QDIA impact 00:45:28 - Summary of Mike's overall perspective 00:46:47 - Final thoughts on market distribution changes FOLLOW MIKE ON TWITTER   / profplum99   SEE LATEST EPISODES https://www.excessreturnspod.com FIND OUT MORE ABOUT VALIDEA https://www.validea.com FIND OUT MORE ABOUT VALIDEA CAPITAL https://www.valideacapital.com FOLLOW JACK Twitter:   / practicalquant   LinkedIn:   / jack-forehand-8015094   FOLLOW JUSTIN Twitter:   / jjcarbonneau   LinkedIn:   / jcarbonneau