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Question
Why is the case for passive investing particularly strong in US large-cap equities?
1
US large-cap index funds have higher returns than their active counterparts by regulatory requirement
2
Thousands of analysts compete to find the same mispricings, making the market highly efficient and costs the dominant factor
3
Passive funds in this category have better tax treatment than active funds
4
US large-cap stocks have lower volatility, which makes passive strategies less risky
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