![]() “If you think something will be better forever, it’s highly unlikely it will be better forever,” he quips. But Jack points out that, while value has indeed outpaced growth stocks over the past 90 years, the performance advantage has disappeared in recent decades. Many investors- including me-tilt their portfolios toward value stocks. He attributes small-cap funds’ larger shortfall to their higher trading costs and higher annual expenses.ģ. But Jack notes that, over the past 15 years, actively managed large-cap funds have trailed their benchmark index by an average 1.54 percentage points, mid-cap funds by 2.01 and small-cap funds by 2.24. stock market style boxes-large-cap growth, small-cap value, mid-cap blended style funds and so on-just 7% of actively managed funds have outperformed their benchmark index over the past 15 years, according to data from S&P Global.Īdvocates of active management often contend that stock pickers are more likely to shine in less efficient markets, such as those for smaller-company stocks. Why buy index funds? Again, Jack goes to the numbers. “I don’t want to be too tough on ETFs, because there are good uses for them,” he allows.Ģ. Jack’s not entirely happy about that-he notes that investors are too quick to buy and sell ETFs-but admits to mellowing somewhat. ETFs now hold slightly more assets than traditional index mutual funds. He points out that today traditional index mutual funds and exchange-traded index funds together account for 37.8% of stock and bond fund assets, up from 9.1% in 2000 and 21.2% in 2010. Here are just some of his comments from this week’s conference:ġ. He was talking about evidence-based investing decades before it was a thing-and even now he’s quick to back his remarks with a timely statistic. Jack’s long day has included launching the first index mutual fund in 1976. Near the beginning of his remarks on Thursday, he quoted the Ancient Greek playwright Sophocles: “One must wait until the evening to see how splendid the day has been.” He then added, “I think my evening is here, and I don’t much like that.” He has a new book, Stay the Course, which should be out next month. And Jack Bogle-even though it’s been more than two decades since he was Vanguard’s Chief Executive Officer-remains their guiding light. They’re renowned as fans of frugality-especially frugally priced index funds. The Bogleheads are, of course, the online community who congregate at. On Thursday and again today, he was at the Bogleheads’ 17 th conference in Philadelphia, as feisty as ever. Bogle was in hospital to receive treatment for his latest health scare-an irregular rhythm in his transplanted heart. ON WEDNESDAY, Vanguard Group’s 89-year-old founder John C.
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