Jack Bogle’s Legacy and YieldStreet

John Clifton Bogle, better known as Jack, passed away on January 16, 2019. His obituaries lionized him as a renaissance man in investing, pushing common sense for the common man. But what were his contributions and why were they so important?

WHO IS JACK BOGLE


Bogle is best known for founding The Vanguard Group and popularizing the index fund. Lauded as one of the investing experts of the 20th century, he held to a strict investment philosophy. The core of his philosophy included keeping investing costs low and that “average” is wholly underrated.

WHAT IS AN INDEX FUND?


An index fund is a collection of stocks, passively bought together to mimic a market index, like the S&P 500 and the Dow Jones Industrial Average. The fund gives similar returns to the stock market because it mimics the index, which mimics the overall United States stock market, giving investors similar returns. The cost on an index fund is very low because there are no fancy portfolio managers actively picking stocks to pay, so fees are kept low, making it easily accessible to most Americans.

Though not the first index fund, Bogle was the first to popularize it. He launched Vanguard’s first index fund under the name First Index Investment Trust, which later became the Vanguard 500 Index Fund.

DO THEY REALLY WORK?


The index fund might have taken a long time to catch on, but it certainly has been held in high regard by investing heavy weights. In fact, in 2007 Warren Buffet bet $1M on it. The terms? He bet that an index fund, specifically Bogle’s creation, the Vanguard 500 Index Fund, could beat any hedge fund. Buffet’s index fund was named the winner in 2017 and not by a small margin. Hedge funds were up 22%, the index fund was up 66%.

WHAT IS THE LEGACY?


Jack Bogle left behind a world where investing wasn’t limited to the elite. He made investing simple and easy, so anyone could jump in, and charged fees so low that the middle class could easily participate. With low fees and steady success, this gave middle class Americans access to true wealth creation opportunities.

WHAT DOES THE FUTURE LOOK LIKE?


Bogle’s mission was to democratize access to investing and always to put investors first. He shaped a new mindset for the financial industry—one that we intend to carry on, and build on. The future of investing depends on opening access to all wealth creation opportunities.

Here at YieldStreet, our mission, “Prosperity for All” means always putting investors first. We’re proud that we’ve been able to open direct access to alternative investing for accredited investors
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