The Mechanical Market

For the first time in history, more money follows a rule than a manager. Most investors know the passive story. Far fewer have fully internalised what it has done to the mechanics of equity markets: how it has changed the way stocks move, how it has transformed the products through which capital is deployed, and how the process by which capital is directed has become increasingly mechanical and rule-driven. Harjinder Thandi explores what this means for those that trade index rebalances.