David J. Rapp

The passive portfolio’s construction is the product of subjective human judgment just as the actively managed portfolio is; passive investing merely involves a different kind of judgment.

This study pushes the boundaries by adding a new dimension to the discussion of the ethics of fair value accounting by examining its ethics from a more systemic and societal perspective.

The much-emphasized distinction between active and passive investing is overblown. The passive portfolio’s construction is the product of subjective human judgment just as the actively managed portfolio is.