The End of Indexing: Six structural mega-trends that threaten passive investing
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Index-tracking is the flavour of the day - it accounts for around one-third of the total US mutual fund market, and is still growing rapidly. Indexing appears to be unstoppable.
But, in The End of Indexing, investment veteran Niels Jensen presents a different vision. In a forthright and compelling examination of the investment landscape, Jensen argues that the economic environment we are entering will be unsuited to index-tracking strategies.
Jensen identifies six structural mega-trends that are set to disrupt investors around the globe:
1. End of the debt super-cycle
2. Retirement of the baby boomers
3. Declining spending power of the middle classes
4. Rise of the East
5. Death of fossil fuels
6. Mean reversion of wealth-to-GDP
In conjunction, these six themes have the potential to create conditions resembling a perfect storm that will result in low economic growth for decades to come. Investment techniques and methodologies - including passive investing strategies - that have worked so well in the bull market of the last 35 years will no longer deliver acceptable results.
As a new investment approach is called for, The End of Indexing provides investors with a guide to the challenging environment ahead and a warning about the future decline of index-tracking.