Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Vanguard Is Growing Faster Than Everybody Else Combined

mobile.nytimes.com

Post reply on HN
Print view View original

111–120 of 358 posts

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#111

Post by subroutine »

cJ0th wrote: post #100

The fact that Vanguard is growing faster than everybody else combined is interesting indeed. The article itself, however, reads like one big ad for Vanguard. The fact that the NYT is somewhat affiliated with them ("They number well over 20 million and include New York Times employees: Vanguard runs the company’s 401(k) retirement plans.") doesn't help either. What I miss is a critical examination of the situation. Th…

Pardon my ignorance, but how would NYT directly benefit from a boost in Vanguard popularity? Say this article somehow elicits a bevy of people/companies to invest in Vanguard, raising their mutual fund from $4.2 to a $4.5 trillion. Given that NYT stake in this fund remains constant, it's not clear to me how this helps NYT employees - unless $4.5 trillion is the tipping-point for market manipulation (but isn't this fund simply tracking major indexes?). Or would the biggest benefit come in the form of even lower fund fees (<0.1%)?

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#112

Post by chillydawg »

SwellJoe wrote: post #89
ilyagr wrote: post #22

Vanguard seems to have gone a bit too far with cost-cutting in the customer services department. One of my most frustrating recent experiences was dealing with Vanguard's website and customer service. There were all kinds of issues, some minor annoyances, others serious time sinks. Here's an excerpt from a long and boring story: ... One day, I couldn't log in to their website. Attempting to go through "forgot my pass…

I don't understand how companies like that can thrive (but many do). If I have to pick up the phone to solve a problem even once, I'm angry. If I have to call them twice, I'm looking at alternatives. I may decide not to switch if the alternatives are even worse...but, I'm looking to get out of the shitty relationship I find myself in with that company. (This frustration is fresh in my mind because Security Metrics ju…

Because their product is SO SO SO much better than the alternative, it's worth the hassle.

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#113

Post by mertens »

ivoras wrote: post #110

It makes me a bit sad that such index funds are not available in my part of the world - even though this is one of the shittiest countries in the EU, services like these are needed precisely because all the other services are so bad.

which country is that? because there are many options available here in Western Europe (alternatives to Vanguard are iShares, SPDRs Europe, Amundi, ...).

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#114

Post by jordanthoms »

ajdlinux wrote: post #55
jordanthoms wrote: post #25

How does control/governance for Vanguard actually work? It's apparently owned by the investors in the funds, but I own some ETFs through Vanguard and I've never seen a proxy form. Very happy with the service, just curious about that aspect.

My understanding is that individual fund investors will never see a proxy form - the fund's decisions on how it will vote are determined by the managers. Also, take a look at https://about.vanguard.com/vanguard-proxy-voting/

I was referring more to control of Vanguard itself - i.e. choosing the Board of directors for Vanguard.

I did a bit of digging though, and it seems they are actually elected by the shareholders of Vanguard funds - but they are appointed for lifetime terms, and up to 1/3 of the directors may be appointed by the other directors. So they only need to go to a vote of shareholders occasionally - looks like the last was in 2009.

The proxy form from that meeting: http://www.vanguard.com/jumppage/proxy/PROXYA.pdf

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#115

Post by cJ0th »

subroutine wrote: post #111
cJ0th wrote: post #100

The fact that Vanguard is growing faster than everybody else combined is interesting indeed. The article itself, however, reads like one big ad for Vanguard. The fact that the NYT is somewhat affiliated with them ("They number well over 20 million and include New York Times employees: Vanguard runs the company’s 401(k) retirement plans.") doesn't help either. What I miss is a critical examination of the situation. Th…

Pardon my ignorance, but how would NYT directly benefit from a boost in Vanguard popularity? Say this article somehow elicits a bevy of people/companies to invest in Vanguard, raising their mutual fund from $4.2 to a $4.5 trillion. Given that NYT stake in this fund remains constant, it's not clear to me how this helps NYT employees - unless $4.5 trillion is the tipping-point for market manipulation (but isn't this fu…

> Pardon my ignorance, but how would NYT directly benefit from a boost in Vanguard popularity?

I never said they would. I could imagine they got paid for this article but if I said so I would go out on a limb as I don't know whether that's the case.

All I am really saying is this:

> What I miss is a critical examination of the situation.

----

edit:

I think this is a more balanced article on Vanguard: http://fortune.com/vanguard-mutual-funds-investment/

(It's from December 2016, though)

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#116

Post by lmm »

cJ0th wrote: post #90
loeg wrote: post #57

Earlier quoted context omitted.

> With index funds so big, who determines prices? ... At some point, this has to create problems, but so far it hasn't. Any active trader remaining in the market. Fortunately, active traders still make up a large part of the market. And the bigger indices grow, the larger the opportunities for active traders to profit. It's not a real problem — it's self-correcting.

> And the bigger indices grow, the larger the opportunities for active traders to profit. It's not a real problem — it's self-correcting. I appreciate that finally someone puts forward a rational argument as to why index fonds will keep working. Books and online resources tend to not take a critical look at the system at all or they offer an answer along the lines of "Trust me!" Having said that, only hindsight is 20…

You're talking as if there's a swarm of fresh money flowing into the market, whereas it's more a case of people shifting away from traditional actively managed mutual funds etc. into indexing.

Money is cheap at the moment because growth is low, and that in turn means risk premia are lower and so on, but I don't think that's related to the rise of index funds. Then again I never understood why active management was so popular in the first place.

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#117

Post by psyc »

subroutine wrote: post #111
cJ0th wrote: post #100

The fact that Vanguard is growing faster than everybody else combined is interesting indeed. The article itself, however, reads like one big ad for Vanguard. The fact that the NYT is somewhat affiliated with them ("They number well over 20 million and include New York Times employees: Vanguard runs the company’s 401(k) retirement plans.") doesn't help either. What I miss is a critical examination of the situation. Th…

Pardon my ignorance, but how would NYT directly benefit from a boost in Vanguard popularity? Say this article somehow elicits a bevy of people/companies to invest in Vanguard, raising their mutual fund from $4.2 to a $4.5 trillion. Given that NYT stake in this fund remains constant, it's not clear to me how this helps NYT employees - unless $4.5 trillion is the tipping-point for market manipulation (but isn't this fu…

It wouldn't. It's utterly insignificant that Vanguard hosts their 401Ks. That's like saying, "Full Disclosure: Many NYT employees have accounts at BOA!"

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#118

Post by bigtimeidiot »

cJ0th wrote: post #100

The fact that Vanguard is growing faster than everybody else combined is interesting indeed. The article itself, however, reads like one big ad for Vanguard. The fact that the NYT is somewhat affiliated with them ("They number well over 20 million and include New York Times employees: Vanguard runs the company’s 401(k) retirement plans.") doesn't help either. What I miss is a critical examination of the situation. Th…

>The fact that the NYT is somewhat affiliated with them

So a disclosure that they use a massively popular product is now an advertisement?

Just one time I'd like to open the comments and not have someone saying "fake news" or "this is just an ad" or "stick with the facts".

Vanguard is an interesting company doing big things. They invented the index fund. They are massive. The New York Times profiles companies like this often.

Personally I find this more interesting than a Musk tweet announcing an announcement six months in advance.

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#119

Post by lmm »

warcher wrote: post #42

I'm fascinated at how Vanguard's essential idea plays out over the long term. The basic value proposition seems to be that Wall Street is extracting more value in fees than they're making in smart stock picks. Which thus far has been pretty accurate, but is the contribution of stock pickers actually zero? Is it negative ? Where do we reach a fixpoint, and how? Do the stock pickers, clever scamps that they are, figure…

> Which thus far has been pretty accurate, but is the contribution of stock pickers actually zero? Is it negative?

Net of fees, probably. There's a certain amount of value contributed to the real economy by accurate stock prices, and a certain amount of that is created by reading the news, being aware of industry trends, etc. But the number of people needed to do that efficiently gets smaller all the time.

> Do the stock pickers, clever scamps that they are, figure out a way to take advantage of the Bogleheads and their naivete? Are they already doing so? Is this going to turn the stock market into just one big house of cards?

It's smoother than that. The more people are indexing, the more profitable the various types of active investment become. There's an equilibrium to be reached. We're probably in for higher volativity than present, sure - but the present low volatility is a historical aberration.

> If I've seen any trends in the financial markets, it's that every good idea will eventually be flogged to death, usually with catastrophic results.

More like it will get flogged until there's no more money in it and it's just a boring utility, like has happened to HFT.

Re: Vanguard Is Growing Faster Than Everybody Else Combined

#120

Post by cJ0th »

bigtimeidiot wrote: post #118
cJ0th wrote: post #100

The fact that Vanguard is growing faster than everybody else combined is interesting indeed. The article itself, however, reads like one big ad for Vanguard. The fact that the NYT is somewhat affiliated with them ("They number well over 20 million and include New York Times employees: Vanguard runs the company’s 401(k) retirement plans.") doesn't help either. What I miss is a critical examination of the situation. Th…

>The fact that the NYT is somewhat affiliated with them So a disclosure that they use a massively popular product is now an advertisement? Just one time I'd like to open the comments and not have someone saying "fake news" or "this is just an ad" or "stick with the facts". Vanguard is an interesting company doing big things. They invented the index fund. They are massive. The New York Times profiles companies like th…

> So a disclosure is now an advertisement?

No it isn't. I merely said that the article reads like an advert (not: it is an advert) and furthermore I said the affiliation would not help to shake this impression off. This is merely an aside and still doesn't imply it is an ad. My main problem with this article is that it is not critically examining what it is reporting about. Whether or not it actually is an ad is secondary.

Post reply on HN