Vanguard Now Exporting Success to Europe


The wild success in passive investing sparked by Vanguard from its headquarters in Malvern is now making the leap over the pond.

A telltale sign that the investment approach is catching on across the Atlantic is that the mutual-fund leader has gone from a single European operative at the start of the financial crisis to a team of more than 300 today, according to a Bloomberg report by Lukanyo Mnyanda.

A new wave of tighter regulations on money management is fueling interest in Vanguard’s trademark index funds, which are projected to grow their share of the market from 15 percent to 30 percent in 10 to 15 years.

“Active is dying from its own disease, it’s dying from its own greed,” said Chief Investment Officer Tim Buckley. “It’s high-cost against low-cost, and high-cost is the dinosaur.”

Passive investing in Europe has accelerated 80 percent over the past three years, and a lot of it has to do with the same reason Vanguard has thrived in the United States: an average fee of 0.18 percent compared to the active management industry standard of one percent, the article stated.

Read more about Vanguard’s expansion into Europe on Bloomberg here, and check out previous VISTA Today coverage of the local mutual fund company here.

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