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Investment Legend Bogle Dies

John Bogle, founder of The Vanguard Group, died Jan. 16, the firm announced. He was 89.

Bogle is best known for his introduction of the first index mutual fund for investors and then standing behind the concept in the face of skeptics until it gained widespread acceptance.

Under Bogle’s vision, Vanguard introduced the First Index Investment Trust for individual investors in 1976, which collected a mere $11 million during its initial underwriting. Now known as the Vanguard 500 Index Fund, it has grown to be one of the industry’s largest, with more than $441 billion in assets. Its sister fund, Vanguard Institutional Index Fund, has more than $221 billion in assets.

“Jack Bogle made an impact on not only the entire investment industry, but more importantly, on the lives of countless individuals saving for their futures or their children’s futures,” Vanguard CEO Tim Buckley stated upon Bogle’s passing. “He was a tremendously intelligent, driven, and talented visionary whose ideas completely changed the way we invest. We are honored to continue his legacy of giving every investor ‘a fair shake.’”

Bogle often was called the “father of indexing” for his pioneering of the index concept for individual investors. Index funds now account for more than 70% of Vanguard’s nearly $5 trillion in AUM.

Bogle and Vanguard further broke from industry tradition in 1977, when the company ceased to market its funds through brokers and instead offered them directly to investors, eliminating sales charges and becoming a pure no-load mutual fund complex.

Additionally, he was widely credited with helping to bring about increased public disclosure about mutual fund costs and performance, often speaking out against common industry practices in the name of safeguarding investors’ interests. “We are more than a mere industry,” he insisted in a 1987 speech before the National Investment Company Services Association. “We must hold ourselves to higher standards, standards of trust and fiduciary duty. Change we must — in our communications, our pricing structure, our product, and our promotional techniques.”

In December 1999, Bogle stepped down from the Vanguard board of directors to create the Bogle Financial Markets Resource Center, a Vanguard-supported venture. He worked as the center’s president, analyzing issues affecting the financial markets, mutual funds and investors through books, articles and speeches until his death. Bogle also was the author of 12 books, selling more than 1.1 million copies worldwide.