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John Waggoner: Vanguard, The King Of Passive Investing, Hops On Board The Active ETF Train
FYI:Vanguard, where the world goes to catch a ride on index funds, is building a new station for actively managed exchange-traded funds.
In a recent filing the with Securities and Exchange Commission, the Valley Forge, Pa., fund giant asked for exemptive relief for offering actively managed ETFs. “This application gives us the flexibility to offer actively managed strategies,” said Vanguard spokeswoman Katie Hirt. “We're making sure we're set up in the future to provide that flexibility Regards, Ted http://www.investmentnews.com/article/20160817/FREE/160819933?template=printart
Yes, the Kng on Passive fund investing has been the leader of an Index investing strategy for decades, but they never abandoned the active gravy train. Typically, Vanguard has offered an alternate actively managed fund in each category that it has organized a passive fund option.
In their many active fund offerings Vanguard has stayed loyal to its low cost mandate. Good for them, but better yet for individual investors. In some categories, active fund management does deliver positive Alpha over an extended timeframe. Being selective using a variety of metrics does identify likely superior investment opportunities, and knowledgeable and disciplined active managers can and do exploit those market opportunities.
Vanguard has long recognized those potential opportunities and has not been reluctant to make money in those areas. Here is a Link to a nice summary of Vanguard's success in the numerous areas that they offer both active and passive fund options:
A quick review of the tables in the referenced article clearly demonstrates that results over a meaningfully large timeframe are a mixed bag when measured by end wealth. Enjoy.
My portfolio, like Jack Bogle's portfolio, is filled with both passively and actively managed fund and ETF products.
Comments
Yes, the Kng on Passive fund investing has been the leader of an Index investing strategy for decades, but they never abandoned the active gravy train. Typically, Vanguard has offered an alternate actively managed fund in each category that it has organized a passive fund option.
In their many active fund offerings Vanguard has stayed loyal to its low cost mandate. Good for them, but better yet for individual investors. In some categories, active fund management does deliver positive Alpha over an extended timeframe. Being selective using a variety of metrics does identify likely superior investment opportunities, and knowledgeable and disciplined active managers can and do exploit those market opportunities.
Vanguard has long recognized those potential opportunities and has not been reluctant to make money in those areas. Here is a Link to a nice summary of Vanguard's success in the numerous areas that they offer both active and passive fund options:
https://assetbuilder.com/knowledge-center/articles/do-vanguards-indexes-beat-their-own-actively-managed-funds
A quick review of the tables in the referenced article clearly demonstrates that results over a meaningfully large timeframe are a mixed bag when measured by end wealth. Enjoy.
My portfolio, like Jack Bogle's portfolio, is filled with both passively and actively managed fund and ETF products.
Best Regards.