The Greatest Investors: John (Jack) Bogle

Born: May 8, 1929 (Verona, New Jersey)

Key Positions: Vanguard Group (founder)

Personal History:
Jack Bogle grew up in a family that had been deeply affected by the Great Depression. As a student of economics at Princeton University, Bogle focused on mutual funds; he graduated magna cum laude in 1951 with a senior thesis entitled "The Economic Role of the Investment Company." This early work contributed to Bogle's lifelong investment philosophy, later career, and eventual development of the index mutual fund.

Bogle worked at Wellington Management from 1951 to 1974, where he quickly rose through the ranks. Bogle famously challenged Wellington's strategy of concentrating its investment efforts on a single fund. In 1974, Bogle founded the Vanguard Group mutual fund company. With Vanguard 500, debuted in 1976, Bogle pioneered index investing as a low-cost, high-return option for investors outside of the wealthiest echelons of the financial world. Bogle also championed the no-load mutual fund.

Bogle served as CEO and chairman of Vanguard until 1999, when he retired from his active role. In the same year, Fortune named Bogle one of the four "investment giants" of the 20th century. Bogle remained on as the president of Vanguard's Bogle Financial Markets Research Center, where he has maintained an active post-investment career as an author and speaker on a variety of financial matters.

In "The Vanguard Experiment: John Bogle's Quest to Transform the Mutual Fund Industry" (1996), biographer Robert Slater describes Bogle's life as "evolutionary, iconoclastic and uncompromisingly committed to his founding principles of putting the interests of the investor first and constructively criticizing the fund industry for practices that run counter to low-cost, client-oriented mutual fund investing."

Investment Philosophy:
As the creator of the broad-based index mutual fund, Bogle focused much of his attention on low-cost and low-turnover funds that are passively managed. With an eye toward helping individual investors to grow their assets, Bogle has recommended the following considerations:

• A focus on simplicity in investment strategy (not rebalancing asset allocation too frequently, for instance)
• The reduction of costs and expenses associated with investments
• Consideration of the long-term investment horizon
• A reliance on rational analysis and an avoidance of emotions in the investment decision-making process
• The universality of index investing as an appropriate strategy for individual investors

Bogle's own portfolio has maintained a strict focus on U.S. markets. This has drawn some criticism and confusion from contemporary investors, but Bogle has long asserted that his approach is not U.S.-centric, but rather that he invests in what he knows best, and U.S. companies best fit that description.

Noteworthy Publications:

• "Bogle On Mutual Funds" by John C. Bogle (1994)
• "Common Sense On Mutual Funds: New Imperatives For The Intelligent Investor" by John C. Bogle (1999)
• "John Bogle On Investing: The First 50 Years" by John C. Bogle (2000)
• "The Little Book Of Common Sense Investing: The Only Way To Guarantee Your Fair Share Of Stock Market Returns" by John C. Bogle (2007)
• "Clash of the Cultures: Investment vs. Speculation" by John C. Bogle (2012)
• "The Vanguard Experiment: John Bogle's Quest To Transform The Mutual Fund Industry" by Robert Slater (1996)

Bogle Quotes:

"[It's] 100% economics in the stock market and 0% emotions."

"Time is your friend; impulse is your enemy."

"If you have trouble imagining a 20% loss in the stock market, you shouldn't be in stocks."

"When reward is at its pinnacle, risk is near at hand."