RIP John Clifton Bogle!He left the industry more than 20 years back. He was happily spending his retirement days. But his impact was deeply felt after his retirement. John Clifton Bogle (born on 8th May, 1929) was associated with the investment management (in India, mutual fund) companies of the US since his youth. After more than 25 years of association, in 1976, he formed Vanguard Company, world's first index fund, in the U.S. The index fund simply replicates the index which it follows. It is the low-cost mutual fund scheme suitable for retail investors. The management fee is minimum in the index funds because there is almost no role of fund managers in the index funds (passively managed funds). Bogle's investment philosophy was very simple. He said: "... 'trying to beat the market was wasteful and expensive for common investors."
Although, his investment philosophy and index fund started becoming popular when Bogle was active in the industry, only 12% equity mutual fund assets were passively managed in the U.S. in 2000. But the retail investors of the USA started investing in index funds in a far greater number only after 2008 after getting badly hit by the global financial crisis. Retail investors (including Indian investors) realized the importance of asset allocation and preferred the safer route of passive investing. In 2017, the share of passively managed equity assets jumped over 42% in the USA.
This great man of the investing world made a huge contribution in making the mutual fund industry, especially passive investing, popular all over the world. At an age of 89-plus, he left the world on 16th January, 2019.
RIP John Clifton (Jack) Bogle, Father of Passive Investing!