Vale Jack Bogle

John Bogle

Investors all around the world lost a friend and passionate advocate this month with the passing of John C. (Jack) Bogle.

The founder of Vanguard Group was a colossus both within and outside the investment industry. A strong believer in pooled investment vehicles like US mutual funds (managed funds to Australian investors), he was a strident and life-long critic of deceptive industry marketing practices and high costs.

It is impossible to overstate the legacy of Jack Bogle. His pioneering work – for which he was publicly derided as ‘un-American’ – has put billions of dollars back into the pockets of investors. Australian investors benefited directly when his long-time assistant Jeremy Duffield returned home to setup Vanguard Australia in 1996 – the first country outside the US to experience the ‘Vanguard effect’ as the group began to expand internationally. Bogle visited Australia in 1998 to speak at investor seminars in Melbourne and Sydney and explain the power of index investing as only he could.

It was a privilege at the time to share the stage with him – in my former guise as a financial journalist – because back then indexing was something of an oddity in the Australian market. The passion and compelling logic built on what he called “the relentless rules of humble arithmetic” left an indelible impression. As did his passion to give individual investors a “fair shake” by keeping fees at rock-bottom levels because “the miracle of compounding returns is overwhelmed by the tyranny of compounding costs”.