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Asset Management

Time for more than Snap judgements

An uncomfortably large portion of the US market is unable to judge whether investments, such as in Snapchat's parent company, make sense or not

To invest or not invest: An impressive 158 million people use Snapchat every day. But should we pay attention to the warning in its prospectus?
To invest or not invest: An impressive 158 million people use Snapchat every day. But should we pay attention to the warning in its prospectus? Photo: Alamy

I have absolutely no idea whether US tech company Snap might make a decent investment, on the assumption it pulls off its proposed $25 billion initial public offering. And I draw absolutely no comfort from the fact that investors controlling nearly a third of the US market don’t have a clue either.

These investors, which run 28.5% of the US market, according to ratings agency Moody’s, are passive investors, who own indexed and exchange-traded funds.

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