Not as clear cut as that. There is a delay before an index rebalances, indexes have tracking error that influences how closely they follow and 'passive funds' do active trading to snip deals on the market.

I forget the name of the yt channel, but they did an interesting interview with Vanguard reps. The reps said that active funds will often need to liquidate assets they will sell at a discount to an index fund directly that will buy it anyway. They don't want to sell to the public market as that would reduce the value of their assets still on the books. In this way a passive fund can take advantage of an active fund and is one of the reasons why many active funds struggle to beat a passive one year after year.

> You are copying what active investors (in aggregate) are doing so if they’re fueling a bubble so are you.

The "in aggregate" is doing some heavy lifting here. Active management holds concentrated positions in certain investments because they think they will outperform. Active folks believe they have found market inefficiencies, whereas passive folks lean towards the market being (relatively) efficient (enough) and chasing returns won't work (at least for most people):

* https://en.wikipedia.org/wiki/A_Random_Walk_Down_Wall_Street

"Active" and "passive" exist on a spectrum and are not binary:

* https://rationalreminder.ca/podcast/133