Malkiel Says He Believes in the 'Blindfolded Monkey' Investor More Than Ever

The video features Burton Malkiel discussing the benefits of passive investing strategies, emphasizing the superiority of index investing over active management. He highlights the growth of indexing and its impact on the market, dismissing concerns about its popularity. Malkiel also addresses the ETF industry's profitability despite low expense ratios and predicts a shift towards robo-advisors in financial advising due to cost efficiency.

What is the main idea behind Burton Malkiel's 'blindfolded monkey' analogy?

• Active management is superior to passive strategies.

• Market timing is crucial for investment success.

• Random selection can perform as well as expert selection.

• Investing in individual stocks is the best approach.

According to studies, what percentage of active managers are outperformed by the index over 15 years?

• 100%

• 70%

• 50%

• 90%

What is a common argument made by active managers regarding the growth of indexing?

• Indexing will lead to market inefficiency.

• Active managers will perform better as indexing grows.

• Active management is becoming obsolete.

• Indexing is a short-term trend.

What is Burton Malkiel's view on the potential risks of indexing becoming too popular?

• He thinks it will lead to higher fees.

• He predicts a decline in market efficiency.

• He sees no significant risks.

• He believes it could destabilize the market.

How can the ETF industry sustain itself despite low expense ratios?

• By increasing management fees.

• Through securities lending.

• By reducing competition.

• By focusing on active management.

What is the expected future trend for financial advisors according to Burton Malkiel?

• A decline in the use of technology.

• A shift towards robo-advisors.

• Higher fees for advisory services.

• Increased reliance on human advisors.

What is the current environment for returns, as mentioned by Burton Malkiel?

• Unpredictable return environment.

• Stable return environment.

• Low return environment.

• High return environment.