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The Big Short’s Michael Burry Sees a Bubble in Passive Investing

  • Rush into index funds has punished small-cap value stocks
  • ‘There is all this opportunity, but so few active managers’
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Is There a Bubble in Passive Investing?
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Michael Burry shot to fame and fortune by betting against mortgage securities before the 2008 crisis, a trade immortalized in “The Big Short.”

Now, Burry sees another contrarian opportunity emerging from what he calls the “bubble” in passive investment. As money pours into exchange-traded funds and other index-tracking products that skew toward big companies, Burry says smaller value stocks are being unduly neglected around the world.