Comment by nickysielicki

This is the kind of wisdom that caused the great financial crisis. Funds are limited in what they can invest in. Institutional investors don’t see high returns. They’re under a lot of pressure to maximize returns within the bounds of what they’re allowed to invest in. There’s a reason they’re risk restricted: they are responsible for a lot of money and society puts a lot of trust into them to not piss away their pension funds.

We learned this lesson the hard way twenty years ago. If we let them invest in dogshit, and the credit rating agencies allow them to, they will.

When institutional investors lose, they’re not really risking their own money. They’re risking yours, or at least your cousins or your neighbors.