The Vanguard Group, Inc.
| The Vanguard Group Inc. | |
| |
| Founded | May 1, 1975 |
|---|---|
| Headquarters | Malvern, Pennsylvania, USA |
| Key People | Salim Ramji, CEO |
| Employees | Approximately 20,000 worldwide |
| Products | Investment Management Company |
| Releases | Company News |
Vanguard is one of the world's largest investment management companies and the largest mutual-fund company in the U.S.[1]
It is one of the "Big Three" asset management firms, along with BlackRock and State Street.[2] [3] On February 18, 2025, Vanguard became the biggest exchange-traded fund issuer after it beat both BlackRock's iShares and State Street's SPY ETFs.
Vanguard surpassed $7 trillion in assets under management in 2020.[4] It is the second largest ETF promoter globally, with approximately $4,528 billion in ETF assets under management, after iShares, with $4,551 billion in AUM.[5]
Vanguard has traditionally steered clear of commodity investing, which its founder John Bogle dismissed as "total speculation." Nearly half a century later, Vanguard has just one commodity fund out of more than 400 offered globally.[6]
The company uses a mutual ownership structure in which its U.S. funds own the management company and fund investors own the funds, which Vanguard says helps it pass profits onto shareholders in the form of cheaper fees.[7] .[8] Vanguard keeps its financial performance private.
When ETFs were first introduced in 1993, they operated as standalone products. The ETF framework changed when the SEC granted the first exemptive relief to Vanguard in October 2000 allowing a dual-class model. The first patent was granted to Vanguard by the Patent Office in April 2005.[9] When the Vanguard patent expired in May 2023, a surge of issuers sought approval to offer this structure while expanding it beyond index-based and into active strategies. By November 2024, almost three dozen fund providers had requested approval from the SEC to use Vanguard’s patented ETF-as-a-share class fund structure.[10] Vanguard “allows mutual fund share class owners to convert into VOO (the Vanguard S&P 500 ETF),” a trade incentivized by the mutual fund arm being slightly more expensive, at 4bp.[11]
History[edit]
John C. Bogle formed Vanguard in 1974 after his removal as chief executive of Wellington Management Company. Vanguard began operating in 1975 as an administrative organization for the Wellington funds. Its name referred to HMS Vanguard, a British naval vessel associated with Admiral Horatio Nelson.[12] Bogle founded the company under an unusual company philosophy: The mutual fund owns the management company and shareholders pay only operation costs for the fund. The Vanguard Index 500 Fund opened a year later with $11 million in assets.
Bogle founded the company on a bedrock of investing in stocks and bonds, which generate cash flow, dividends and interest payments.
In August 1976, Vanguard introduced First Index Investment Trust, later renamed Vanguard 500 Index Fund. The fund tracked the S&P 500 and gave retail investors access to an index mutual-fund structure at a time when index investing was used principally by institutions. The offering raised $11.3 million, below its $150 million target, but established a product model that became central to Vanguard’s business. [13]
In 1982, Vanguard began offering retirement planning services, and in 1990 the company went international. The company began offering tax-advantaged 529 college-savings plans in 1998.
Bogle’s organization initially had limited authority to manage assets directly because of its earlier relationship with Wellington Management. The separation evolved into a longstanding partnership in which Wellington managed certain Vanguard active strategies while Vanguard expanded its own investment-management capabilities. The arrangement reflected wider changes in the mutual-fund industry, including the growth of no-load funds, lower-cost index products, and direct distribution to investors.[14]
Bogle retired as chief executive officer in 1996 and was succeeded by John J. Brennan. F. William McNabb III was appointed CEO in 2008 and chairman of the board in 2010 and his successor, Tim Buckley, became CEO in 2018. During this period, Vanguard expanded its exchange-traded-fund lineup, advice operations, retirement products, and international businesses as passive investing became a larger part of public securities markets. [15]
Vanguard introduced its Vanguard S&P 500 ETF (ticker VOO) in 2010. The fund rapidly gained market share, boosted by Vanguard’s following of fee-sensitive retail investors and financial advisers. VOO charges a fee of only 0.03% to track the S&P 500, compared to SPY's fee of 0.095% per year.[16]
In early 2024, when its industry peers all launched spot Bitcoin ETFs, Vanguard abstained from offering the instruments and pulled its futures-backed Bitcoin funds from its platform as well, leaving Vanguard offering no crypto products whatsoever.[17]
On November 1, 2024, Vanguard supplanted its rival BlackRock, the world’s largest asset manager, as manager of the second-largest exchange traded fund in the world, when Vanguard’s S&P 500 ETF (VOO) reported assets of $540.76bn at market close, marginally ahead of BlackRock’s iShares Core S&P 500 ETF (IVV) with $540.66bn.
On February 18, 2025, Bloomberg reported that Vanguard's "VOO" ETF had overtaken State Street's SPY as the world biggest ETF, raking in $23 billion so far in 2025. The Vanguard S&P 500 ETF (ticker VOO) commanded more than $1 trillion in assets as of June 2026.[18]
On June 2, 2026 Vanguard S&P 500 ETF (NYSE:VOO), passed the milestone of $1 trillion in assets under management. After the ETF passed that milestone earlier in the month, however, VOO faced outflows and could not reach the $1,000.00 billion in AUM at the end of June. It was nevertheless an important milestone marking a new reality in which ETFs could become larger than $1 trillion in assets under management.[19]
In August 2026, The Vanguard Group struck a deal to acquire the wealth management platform Altruist, pushing further into financial advice. The transaction was reportedly worth around $4 billion. Altruist, founded in 2018, is an upstart competitor to Charles Schwab and Fidelity Investments and operates a self-clearing brokerage along with software that serves independent wealth-management firms.[20]
Products and Services[edit]
Personal Investors
- Mutual funds, exchange-traded funds (ETFs), individual stocks and bonds, and access to non-Vanguard funds
- Flagship® and Voyager® Services
- Advice and financial planning services
- Retirement planning
- College savings options, including 529 plans.
Institutional Investors
- Investment management
- Comprehensive advisory services
- Administrative and recordkeeping services
- Retirement plan consulting
- Education
- Research and commentary
Financial Advisors
- ETFs and mutual funds
- Fund managers
- Investment education
- Research and commentary[21]
Key People[edit]
- Salim Ramji, Chief Executive Officer
- Greg Davis, President, Chief Investment Officer
- Matthew Benchener, Managing Director, Personal Investor
- Amma Boateng, Managing Director, Financial Advisor Services Division
- Joseph Brennan, Managing Director, Global Chief Risk Officer
- Jon Couture, Managing Director, Human Resources, Chief Human Resources Officer
- John James, Managing Director, Workplace & Advisor Solutions Group
- Chris McIsaac, Managing Director, International Division
- Tonya Robinson, General Counsel, Secretary Vanguard Funds
- Michael Rollings, Managing Director, Finance Division, Chief Financial Officer
- Joanna Rotenberg, Managing Director, Advice & Wealth Management Division
- Nitin Tandon, Managing Director, Information Technology Division, Chief Information Officer
- Lauren Valente, Managing Director, Institutional Investor Group
References[edit]
- ↑ Who We Are. Vanguard.
- ↑ This chart shows how ‘The Big Three’ may soon be two. MarketWatch.
- ↑ Vanguard Inflows Topped 2022, Beating iShares. etf.com.
- ↑ Vanguard’s assets hit record $7tn. The Financial Times.
- ↑ U.S. ETF Industry Review, July 2026. LSEG.
- ↑ Vanguard unfazed by boycott calls after it refuses to offer Bitcoin ETFs: ‘They won’t lose a single 401k plan over it’. Fortune.
- ↑ Vanguard Names Former BlackRock Executive as CEO. The Wall Street Journal.
- ↑ About Vanguard. Vanguard UK Professional.
- ↑ ETF as a Share Class is Here, What is Next?. J.P. Morgan Asset Management.
- ↑ Fund Providers Flock to Vanguard’s ETF Share Class. Morningstar.
- ↑ Vanguard deposes BlackRock as provider of world’s second-largest ETF. The Financial Times.
- ↑ Jack Bogle: The man who pioneered index investing. BBC News.
- ↑ The Index Fund Turns 50: How Jack Bogle Changed Investing Forever. Morningstar.
- ↑ The Inside Story of How Wellington and Vanguard Became Partners. Institutional Investor.
- ↑ The Vanguard Group. Bogleheads Wiki.
- ↑ Vanguard Overtakes State Street as World’s Biggest ETF. Bloomberg.
- ↑ Vanguard unfazed by boycott calls after it refuses to offer Bitcoin ETFs: ‘They won’t lose a single 401k plan over it’. Fortune.
- ↑ Vanguard Overtakes State Street as World’s Biggest ETF. Bloomberg.
- ↑ Vanguard S&P 500 ETF Becomes The First to Cross $1T in AUM. Investing.com.
- ↑ Vanguard Buys Wealth Management Platform Altruist in $4 Billion Deal. The Wall Street Journal.
- ↑ What We Offer. Vanguard.