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by wookmaster14 hours ago |
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upvoteby JumpCrisscross14 hours ago|
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> Why else would they change the rule ?

These indices aim to replicate the market. They’re not trying to pick stocks.

There is a serious argument for saying they fail to replicate the market if they structurally exclude trillions of dollars of it.

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upvoteby yxhuvud13 hours ago|
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It defeats the purpose of the value setting part of the IPO if there are guaranteed buyers. It would be better for the market and for the indices if they only hopped onto new entries of the market after any initial instability has passed.
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upvoteby JumpCrisscross11 hours ago|
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> defeats the purpose of the value setting part of the IPO if there are guaranteed buyers

The indices don't buy into the IPO, but a few days afterwards. That's obviously easier to bridge than 6 months. But IPO buyers are still taking a risk.

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upvoteby lenerdenator13 hours ago|
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They also exclude many other things that are of economic value, because they could cause structural or social harm in the markets.
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upvoteby JumpCrisscross12 hours ago|
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> They also exclude many other things that are of economic value, because they could cause structural or social harm in the markets

Which index are you thinking of?

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upvoteby s1artibartfast13 hours ago|
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Yes, but a stock market index is just that. It is intended to track stocks, not meth sales or the phase of the moon.

Most of these indicies intend to match the largest companies on the market - going up when they do and going down when they do.

If someone doesnt want that, they can pick a different index or invest in a managed fund. Companies like vanguard also offer custom EFTs where you can exclude certian companies if you want - probably the simplest option.

But then you cant complain if they go up and you miss out.

PS: Yes, there are several cannabis ETFs if you are into that kinda thing. look into MJ, WEED, MSOS, and YOLO.

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upvoteby tikhonj13 hours ago|
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Because they think that a lot of people will want to get in on the historically massive and well-known companies, which would lead to outflows if the index doesn't pick them up fast enough?
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upvoteby californical12 hours ago|
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It will lead to outflows either way. And I say that as someone who has been an Index fund evangelist for years, strongly considering selling my index funds to build my own collection of companies that I believe in long term.

So why not just stick to the roles we agreed on when buying in?

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