Photograph by Ross Mantel for Bloomberg Businessweek

Odd Lots: How Poker Explains the Battle Between Passive Investing and Active Management

The game's getting harder.

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Every week, hosts Joe Weisenthal and Tracy Alloway take you on a not-so-random walk through hot topics in markets, finance and economics.

Among the biggest trends in the world of markets is the rise of passive investing. Rather than pay high fees to active mutual fund managers who often fail to beat the market, money has been pouring into passive strategies that track major indices and charge smaller fees.

So what are the ramifications of this trend for investors who choose to remain active?

On this week's Odd Lots podcast, we speak with Michael Maouboussin, who heads global financial strategies at Credit Suisse Group AG and is not just an expert on the world of investing, but also on the role of luck in success. As he sees it, trading is like a game of poker, and in poker you want to play against weaker, less-skilled players. But as more and more of those less-skilled players opt not to trade actively, the game is getting harder.