when the vanguard 500 fund was launched in its initial iteration it raised only 11 million in its first underwriting in 1976 as of july 28 2022 the fund manages more than 709 billion in assets 12
bogle retired as ceo and chair of vanguard in 1999 and wrote common sense on mutual funds new imperatives for the intelligent investor the same year which has since become a classic for investors worldwide 1john bogle contributed significantly to the popularity of index investing in which a fund maintains a mix of investments that track a major market index bogle s philosophy that average investors would find it difficult or impossible to beat the market over time led him to prioritize ways to reduce expenses associated with investing in mutual funds for example bogle focused on no load funds featuring low turnover and simple investment strategies the philosophy behind passive investing generally rests upon the idea that the expenses associated with chasing high market returns cancel out most or all of the gains an investor would otherwise achieve with a passive strategy that relies upon funds with lower turnover management fees and expense ratios passive investing stands in contrast to active investing which requires managers to take a more hands on role with the intent of outperforming the market index funds fit this model nicely because they base their holdings on the securities listed on any given index investors who purchase shares in index funds gain the benefit of the diversity represented by all the securities on an index this protects against the risk that a given company will lower the performance of the overall fund index funds also more or less run themselves as managers only need to ensure their holdings match those of the index they follow this keeps fees lower for index funds than for funds with more active trading finally because index funds require fewer trades to maintain their portfolios than funds with more active management schemes index funds tend to produce more tax efficient returns than other types of funds 