February 4, 2019
The financial world lost a giant when John Bogle passed away last month, succumbing to cancer at age 89.
Bogle, who also went by “Jack,” was the father of low-cost passive investing and founded Vanguard in 1974, then helped build it into a juggernaut that now holds more than $5 trillion in assets. Part of that rise included introducing the world’s first index fund in 1975 and having an approach which continually forced competitors to lower fees. He even has a devoted clan of followers who call themselves “Bogleheads.”
Millions of people retired, sent their kids to college, and ultimately kept more of their nest eggs using Bogle’s investment philosophies. And without him, none of it would have happened.
Bogle always put the investor first. As a shareholder-owned firm, Vanguard’s owners and shareholders are one in the same. This ownership structure – uncommon in the investment world – kept investor fees low and grew the firm a compounded 21 percent annually from 1974-2014.
Bogle’s first rule of life was “to get out of bed in the morning.” If that doesn’t happen, nothing else will either. Too true.
A favorite Bogle quote of mine is, “’Casino’ may be too kind a term to describe the Wall Street of today’s marketplace.” He said that in 2014, railing against people collecting fees for profit while adding little value.
Another is, “The investment business is 80 percent luck and 20 percent skill.” That’s wisdom to always keep in mind.
Lastly, his sage advice to “in the long-term, try to mirror the market, not beat it” reminds us that always picking winners that outpace the market is impossible.
One thing is certain – Mr. Bogle was an investment pioneer who will be missed.