In a recent interview with NYU professor and research firm L2 founder Scott Galloway, Bloomberg columnist Barry Ritholtz shares insights about investing, current market trends and what may lie ahead.

Here are some highlights:

• Ritholtz points out that 2017 was an unusual year for the market given the extremely low level of volatility. The recent correction he says, is normal. “Risk is a two-sided coin,” he argues. “If you want potential upside, you must be willing to accept potential downside.”
• As more investors move to passive investing, it creates an opportunity for active managers. That said, investors want to avoid “closet indexers”—those active managers who “hug” the benchmarks and don’t have a high degree of active share.
• Emotion is the investor’s enemy, says Ritholtz. “People confuse outcome with process,” he says, and tend to flock to those managers that have seen recent success. Separating skill from luck is difficult, he argues, because “we’re bad at conceptualizing in the long run.”

Ritholtz cites bitcoin as a perfect example of how many investors are drawn to the latest, “hot” thing. “You might as well go to Vegas,” he quips.