In theory. In practice the people who can control market pricing can force out even passive investors because passive investors still get valuation reports albeit on a less timely basis. Burry almost lost his shirt shorting sub-prime credit, as Morganchase and Goldmans mispriced his derivatives more and more egregiously as the market moved in Burry’s favor in a bid to get his investors to force him out of his/their positions using ignorant fear. Passive investors are generally not market savvy, that’s why they are passive.