It's Jack Bogle's world. The rest of the asset management business is just living in it.
Fresh off setting a record for most net inflows in a single year, The Vanguard Group Inc., which Mr. Bogle founded in 1975, took in $53.6 billion in the first quarter, a single-quarter record for the Malvern, Pa.-based firm. It's also $15 billion more than was taken in by Pacific Investment Management Co. LLC, the second-best-selling mutual fund company in the first quarter, according to Lipper Inc.
Last year, Vanguard pulled in more than $138 billion, topping JPMorgan Chase & Co.'s record of $129 billion in net inflows for a single year in 2008.
“There're two things going on,”? said Mike Rawson, analyst at Morningstar Inc. “The primary driver has been the shift to low-cost passive investing. Vanguard has some of the lowest options available, so they've benefited from that. They also have a lot of good bonds funds, and investors have been clamoring for bonds.”?
Vanguard has been pounding home the message “low costs lead to better long-term results”? for almost 40 years, so it's no surprise to see them benefiting from a higher demand for passive investments.
But it isn't their cheerleading that's turned the tide, said Dan Wiener, editor of The Independent Adviser for Vanguard Investors.
“Interest in active management is fading because the press is fading on it,”? he said.
Can you blame the media when only one in four large-cap equity funds have beaten the S&P 500 over the 10-year period through 2012?
Jack Bogle is without doubt one of the greatest investors of all time. And it is not an overstatement to call him the conscience of Wall Street. He should have gotten the Nobel Prize in economics for inventing the index fund. Without the ability to index stocks I don't think the PP would work very well.
Trumpism is not a philosophy or a movement. It's a cult.
“Let every man divide his money into three parts, and invest a third in land, a third in business and a third let him keep by him in reserve.� ~Talmud
Vanguard is great but their platform sucks. Why do they seperate each account into two parts...the main account and then the brokerage account? Is there a rationale bend that?
All of humanity's problems stem from man's inability to sit quietly in a room alone. - Blaise Pascal
doodle wrote:
Vanguard is great but their platform sucks. Why do they seperate each account into two parts...the main account and then the brokerage account? Is there a rationale bend that?
Its because you hold the mutual fund shares directly, not through a broker's street name. They are doing that to protect you.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Bean wrote:
but...I thought indexing is for Muppets?
Smart-money muppets, maybe, because the dumb-money muppets don't index! They underperform even buy and hold, only earning about 2-3% net a year for any wide number of various mental delusions.
The benefits of passive indexing are great in everything but the weighting-scheme, i.e. asset allocation, discipline, rebalancing, quantitative stock selection, etc. which are behaviors muppets and Wall Streeters are sorely missing.
Last edited by MachineGhost on Tue Apr 16, 2013 6:48 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Doodle wrote:Vanguard is great but their platform sucks. Why do they seperate each account into two parts...the main account and then the brokerage account? Is there a rationale bend that?
I believe their brokerage accounts used to be handled by Pershing (might still be) and that someday soon (!) this would go away and the mutual fund and brokerage accounts would merge. I heard this quite a while ago...
It is the settled policy of America, that as peace is better than war, war is better than tribute. The United States, while they wish for war with no nation, will buy peace with none"James Madison
