Remembering Jack Bogle: Why Warren Buffett once wanted a statue to be made for ‘king of index funds’

By: |
Published: January 18, 2019 5:17:10 PM

Such is Jack Bogle's repute that even Warren Buffett wrote in his praise, “If a statue is ever erected to honor the person who has done the most for American investors, the hands down choice should be Jack Bogle."

The Vanguard Group, the firm Jack Bogle started in 1975 now has 190 funds and about $5.3 trillion in assets, and an average expense ratio of 0.11%. (Image: Reuters)

Jack Bogle, often referred to as the ‘King’ of index funds, died on 16 January, a little over three months short of his 90th birthday. Such is the great man’s repute that even Warren Buffett wrote in his praise recently, “If a statue is ever erected to honor the person who has done the most for American investors, the hands down choice should be Jack Bogle.” We take a look closer look at Jack Bogle’s contribution to the global mutual fund industry.

Pioneering low-cost investing

Jack Bogle had based the concept of index fund investing on the premise that, in the long-term, it would not be possible to achieve returns superior than the market, after taking into account the costs associated with actively managed funds. His idea was that instead of trying to beat the market and charging high costs, the index fund would mimic the index performance over the long run — thus achieving higher returns with lower costs.

The Vanguard Group, the firm Jack Bogle started in 1975 now has 190 funds and about $5.3 trillion in assets, and an average expense ratio of 0.11%. “For decades, Jack has urged investors to invest in ultra-low-cost index funds. In his crusade, he amassed only a tiny percentage of the wealth that has typically flowed to managers who have promised their investors large rewards while delivering them nothing – or, as in our bet, less than nothing – of added value,” Warren Buffett had written in a letter to shareholders.

Also read: Wipro Q3 net profit up 32% on-year; announces 1:3 bonus issue

Jack Bogle is often quoted as saying, “Fund investors are confident that they can easily select superior fund managers. They are wrong.”  Warren Buffett’s had once estimated that investors wasted more than $100 billion on high-fee Wall Street money managers over the past 10 years.

“In his early years, Jack was frequently mocked by the investment-management industry. Today, however, he has the satisfaction of knowing that he helped millions of investors realize far better returns on their savings than they otherwise would have earned. He is a hero to them and to me,” Warren Buffett had said about Jack Bogle.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Next Stories
1Sun Pharma share price plunges more than 12% after whistleblower complaints resurface
2Petrol price today: Fuel prices continue to rise; petrol at Rs 70.55 per litre in Delhi; check latest rates
3Rupee falls 20 paise to 70.23 per US dollar in early trade; 10-year govt bond yields rise