John Bogle, the founder and chief executive of The Vanguard Group, has passed away at the age of 89.
“Jack Bogle made an impact on not only the entire investment industry, but more importantly, on the lives of countless individuals saving for their futures or their children’s futures,” said Tim Buckley, Vanguard chief executive, in a news release Wednesday afternoon that confirmed Bogle’s death. “He was a tremendously intelligent, driven and talented visionary whose ideas completely changed the way we invest. We are honored to continue his legacy of giving every investor ‘a fair shake.’”
He founded Vanguard, the world’s largest mutual fund organization, in 1974, and later served as chairman and CEO until 1996. As of Sept. 30, 2018, it had about $5.3 trillion in global funds under management.
In 1999, Fortune magazine named Bogle as “one of the four investment giants of the twentieth century.”
Bogle had legendary status in the American investment community, largely because of two towering achievements. One, he introduced the first index mutual fund for investors in 1976, First Index Investment Trust (a precursor to the Vanguard 500 Index Fund), the first index mutual fund available to the general public. And two, 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.
First Index Investment Trust collected a mere $11 million during its initial underwriting. Now known as Vanguard 500 Index Fund, it has grown to be one of the industry’s largest, with more than $441 billion in assets (the sister fund, Vanguard Institutional Index Fund, has $221.5 billion in assets). Today, index funds account for more than 70 percent of Vanguard’s $4.9 trillion in assets under management; they are offered by many other fund companies as well and they make up most exchange-traded funds (ETFs).
Bogle was born in Montclair, N.J., on May 8, 1929, along with his twin brother David, to William and Josephine Bogle.
In 1947, Bogle graduated from Blair Academy cum laude and was accepted at Princeton University, where he studied economics and investment. Bogle, a resident of Bryn Mawr, Pa., began his career in 1951 after graduating magna cum laude in economics from Princeton University. His senior thesis on mutual funds had caught the eye of fellow Princeton alumnus Walter Morgan, who had founded Wellington Fund, the nation’s oldest balanced fund, in 1929 and was one of the deans of the mutual fund industry. Morgan hired the 22-year-old Bogle for his Philadelphia-based investment management firm, Wellington Management Co.
Bogle worked in several departments before becoming assistant to the president in 1955, the first in a series of executive positions he would hold at Wellington: 1962, administrative vice president; 1965, executive vice president; and 1967, president. Bogle became the driving force behind Wellington’s growth into a mutual fund family after he persuaded Morgan, in the late 1950s, to start an equity fund that would complement Wellington Fund. Windsor Fund, a value-oriented equity fund, debuted in 1958.
When he formed The Vanguard Group it handled the administrative functions of Wellington’s funds, while TDPL/Wellington Management would retain the investment management and distribution duties.