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Vanguard
Type	Client owned
Founded	Valley Forge, Pennsylvania (1975)
Headquarters	Malvern, Pennsylvania, USA
Key people	John J. Brennan, Chairman & CEO; John C. Bogle, Founder (retired)
Industry	Investment management
Products	Mutual funds, Brokerage, Asset Management
Revenue	N/A
Employees	12,000+ (2006)
Website	www.vanguard.com

For the anarchist group, see Vanguard Group (anarchist).

Vanguard is a United States investment management company that offers mutual funds and other financial products and services to individual and institutional investors in the United States and abroad. Company headquarters are in Malvern, Pennsylvania. Founder and now retired chairman of the board, John C. Bogle, is credited with the creation of the first index fund available to individual investors, the popularization of index funds generally, and driving costs down across the mutual fund industry.

Vanguard is unusual among mutual-fund companies since it is owned by the funds themselves. In this structure, each fund contributes a set amount of capital towards shared management, marketing, and distribution services. The company claims that this structure better orients management towards shareholder interests. Other mutual-fund sponsors are expected simultaneously to make a profit for their outside owners and provide the most cost-effective service to funds for their shareholders.

For his undergraduate thesis at Princeton, John C. Bogle conducted a study in which he found around three quarters of mutual funds did not earn any more money than if they invested in the largest 500 companies simultaneously, using the S&P 500 stock market index as a benchmark. In other words, three out of four of the managers could not pick better specific "winners" than someone passively holding a basket of the 500 largest public U.S. companies. The managers could pick specific stocks which would do as well as picking the 500 largest stocks (essentially doing as well as random chance would dictate), but the cost to pay their expenses, as well as the high taxes incurred through active trading, resulted in underperforming the index.

The argument at the time was that it was impossible to invest in an index. John Bogle used this information and attempted to create a way that one could invest in an index. Having founded Vanguard as a broker-sold mutual fund company, he eventually turned the company into a no-load fund firm (meaning that the buyer pays no sales commission — called a "load." — when buying or selling fund shares) and in 1976 introduced his first index fund. This first index for individual investors, called the Vanguard 500 (which invested in the 500 companies that made up the S&P 500), has since out-performed many other competing large mutual funds^[1]. Over 100 billion dollars are invested in this mutual fund, and Vanguard has since created other index funds that focus on stocks in particular industries, countries, or companies of varying size (such as "small-cap" or "mid-cap" indexes). Bogle retired from Vanguard in 1999 and was succeeded as Chairman by Jack Brennan. Nevertheless, Vanguard has continued to follow Bogle's emphasis on index funds and low expenses to share owners.

Since its founding in 1975, Vanguard has grown to become the world’s largest pure no-load mutual fund company. While mostly known for its low cost index funds, Vanguard also offers a variety of low cost, actively managed mutual funds and a line of exchange-traded funds (ETF) known as Vanguard ETFs (formerly known as Vanguard Vipers). Vanguard also provides brokerage services, variable and fixed annuities, educational account services, financial planning, asset management, and trust services.

Vanguard contracts out management of its actively managed funds to various investment firms, and sets a portion of the management expenses paid by shareholders based on the fund's performance. Its oldest fund is the Wellington Fund formed in 1928 and operated by Wellington Management Company.

• Money market
• Sweep account

• Vanguard's official website
• Vanguard's official careers website
• Vanguard Mutual Funds article at About.com
• Vanguard fund family overview

• Yahoo! - The Vanguard Group, Inc. Company Profile
• VFINX: Summary for VANGUARD INDEX TRUST 500 INDEX - Yahoo! Finance
• Yahoo! - Mutual funds listed by assets