John Bogle, a giant of the financial world who democratized stock markets, died Wednesday. He was 89.
Vanguard Group, which Bogle founded, confirmed his death in an announcement this evening.
“Mr. Bogle had legendary status in the American investment community, largely because of two towering achievements,” Vanguard said. “He introduced the first index mutual fund for investors and, in the face of skeptics, stood behind the concept until it gained widespread acceptance; and he drove down costs across the mutual fund industry by ceaselessly campaigning in the interests of investors.”
Bogle led Vanguard as CEO from the 1970s until 1996, when his handpicked successor John Brennan took the reins.
Vanguard remains one of the world’s largest investment firms, managing $4.9 trillion of assets at the end of last year, according to the announcement.
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Through the rest of his life after stepping down from Vanguard, Bogle wrote books and advocated for accessible low-cost investing to benefit all, not only the elite.
“Think about it this way,” he told II in 2016. “You can access the returns of the total stock market through an index fund at five basis points a year, which is five one-hundredths of 1 percent a year. Or you can access it by going on your own and buying mutual funds, trading stocks yourself, and access that return, and you lose 2 percent a year. You’re paying not only management fees but portfolio turnover costs. You have drag of cash. There are sales loads out there. And 2 percent is probably a conservative number.”
Bogle, who had a heart transplant in 1996, lived to see the swing from active management to the passive vehicles he and Vanguard pioneered.
“The implications are wide,” he said in the interview, “and they all point to giving the investor a higher share of the market’s return. That’s good for investors, and it’s bad for Wall Street.”