John Bogle is in the news and quoted often for a damn good reason. It’s time to find out what the indexing giant has been doing while celebrating his 85th birthday. Below are links to four recents articles about this great man and the company he founded in 1975, Vanguard Group. His story and comments about the massively popular indexing strategy has begun to revolutionize investing for the ordinary chap.
The asset size of Vanguard Group grew from 180 billion, almost 20 years ago to 1.25 trillion in 2008 to a now massive 3.1 trillion. That’s a lot of money out of Wall Street brokerage houses and big banks’ greedy bonuses and excessively high fees. We pay .13% cost for our portfolio, all of our money is in Vanguard.
The Stock Market seems to be ignoring the big risks. Excerpt: John Bogle, founder of the Vanguard group, spots risks of a severe setback in the stock market, but encourages investors to stay the course even if the ride gets bumpy.
Goldman Sachs Loses Luster Comparison Mutual Fund Performance. Excerpt: A slew of money managers and academics—Robert Arnott of Research Affiliates, for example, and Andrew Lo at AlphaSimplexGroup—say they’re building on what Bogle created. As they offer new categories of passive investment products, Bogle mostly grumbles. Likewise, as established money management giants such as BlackRock cut fees on some funds and expand their index offerings, he remains skeptical that they embrace his world view.
Street Talk about Buffett and Bogle by Jonathan Clements Excerpt: It’s a long-running debate: Should you trust your retirement savings to an actively managed mutual fund that pays fees to a manager who hopes to beat the market. Or, is it better to pick a more passive investment strategy with lower fees? You’re probably well aware of Warren Buffet and John Bogle’s affinity for index investment funds. Buffett, of course, is CEO of Berkshire Hathaway, and Bogle is the founder of Vanguard Group. Wall Street Journal columnist Jonathan Clements shares that affinity. He adds an interesting point to the discussion: index funds, promote good investor behavior.
John (Jack) Bogle decries fat, dumb asset managers. Excerpt: When it comes to thought leaders in the investment world, Vanguard founder Jack Bogle (85) ranks up there with the one year younger Warren Buffett. Bogle fought tirelessly to introduce the world to index tracking passive investments, now more widely known as Exchange Traded Funds. His efforts ushered in a massive new industry that today attracts the lion’s share of savings in developed markets – and a growing slice in developing countries like South Africa. In this superb piece to be published in next month’s Bloomberg Business, Bogle shows there’s plenty of fight left in this particular old dog.