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Joined 2 years ago
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Cake day: June 12th, 2023

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  • I’m not sure why you’re specifically focusing on mutual funds. Holding of public shares is supposed to be a passive income whether it’s individual investors (who are hopefully diversifying their investments), mutual funds, ETFs, etc. The board works for the shareholders by collecting data, assessing that data, and then making recommendations so that investors don’t have to do that research. Sure, it’s possible that the shareholders vote against the advice of the board, but it’s pretty rare. If the board is out of step with the shareholders, they should probably be replaced. This is a virtuous cycle (or vicious cycle for other stocks) where Costco is seen as a fairly ethical company, so investors who are looking for stocks that meet their values choose companies like Costco (whether they are individual investors or investment vehicles marketed as fitting certain values). These investors choose a board who represents their values, so I don’t think, “we’re just lucky that Costco’s board of directors isn’t terrible,” I think it’s a part of this virtuous cycle.