Billionaire Howard Marks Thinks the Future of Investing Contains Fewer People
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Billionaire Howard Marks said the rise of index funds and computer-driven trading are reducing the role of people in the markets but creating room for a select few money managers to excel.
In a 17-page memo Monday, the co-chairman of investment firm Oaktree Capital Group LLC analyzed the effects of three industry trends: the increased use of passive, quantitative and artificial intelligence strategies in investing. On the first, Marks, 72, sees money continuing to flow into index products including exchange-traded funds. That has benefits such as reduced fees, trading costs and errors for investors, but a few active managers will outperform and remain in demand, he wrote.