Apollo Global Management and Citadel are raising concerns about the risks associated with the growing dominance of passive funds, highlighting hidden costs such as increased volatility and reduced liquidity. Citadel argues that regulators are underestimating the importance of active managers, which hampers their growth. This comes as US exchange-traded funds, a key component of passive investing, see record net inflows of $913 billion this year, pushing total assets beyond $10 trillion amid a strong US stock market.
