Timeline of index funds
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This is a timeline of FIXME.
Contents
Big picture
| Time period | Development summary |
|---|---|
| 1960s | A theoretical model for an index fund appears in the decade. |
| 1970s | Index funds are first developed. |
| 1980s | Competing index funds emerge. |
| 1990s | Index investing becomes popular. The acceptance of index funds accelerates. |
Full timeline
| Year | Event type | Details | |
|---|---|---|---|
| 1960 | The first theoretical model for an index fund is suggested by Edward Renshaw and Paul Feldstein, both students at the University of Chicago. While their idea for an "Unmanaged Investment Company" garners little support, it would start off a sequence of events in the 1960s that would lead to the creation of the first index fund in the next decade.[1][2] | ||
| 1967 | Qualidex Fund, Inc., a Florida Corporation, is chartered by Richard A. Beach.[3] | ||
| 1971 | Batterymarch Financial Management of Boston independently decides to pursue the idea of index investing.[4] | ||
| 1971 | Wells Fargo launches an early index fund, consisting of an equal weighting of all the stocks listed on the New York Stock Exchange, about 1,500. However, constant rebalancing and excessive transaction costs turn the running of the fund very difficult.[5] | ||
| 1972 | Early index fund is created by Qualidex Fund, Inc.[2] It is based on the Dow Jones Industrial Average of 30 stocks.[6] | ||
| 1973 | Wells Fargo launches new fund tracking the S&P 500 in a market-cap weighted closed-end fund for institutional investors.[5] | ||
| 1973 | John McQuown and David G. Booth of Wells Fargo, and Rex Sinquefield of the American National Bank in Chicago, establish the first two Standard and Poor's Composite Index Funds. | ||
| 1973 | Rex Sinquefeld launches "the first publicly marketed index fund" at the American National Bank of Chicago, for institutional investors.[5] | ||
| 1973 | Literature | American economist Burton Malkiel writes A Random Walk Down Wall Street, which presents academic findings for the lay public. At the time it is becoming well known in the popular financial press that most mutual funds are not beating the market indices.[6][2] The book includes one of the earliest calls for indexing.[4] | |
| 1974 | American investor John C. Bogle founds the Vanguard Group of Investment Companies.[7][8][9][2] | ||
| 1974 | The first multiclient index fund is probably launched by Batterymarch Financial Management.[10] | ||
| 1975 | John Bogle founds The Vanguard Group to create a new way of investing.[5] | ||
| 1975 | The Vanguard Group creates the world’s first index mutual fund.[11] | ||
| 1976 | The First Index Investment Trust is launched. It would soon attract much derision for its central premise: That just buying and holding the broad stock market would provide better results than trying to beat it by picking stocks.[12][13] | ||
| 1984 | Wells Fargo creates the second index mutual fund (Stagecoach Corporate Stock Fund).[14][15][16][17] | ||
| 1985 | The first bond index fund is in the early conceptual stages.[18] | ||
| 1986 | Colonial Index Trust is launched.[19][11] | ||
| 1986 | The first bond index fund for individual investors is formed.[16] | ||
| 1987 | The Vanguard Extended Market Index Fund is created.[11] | ||
| 1987 – 1990 | The conceptual framework of the Vanguard index fund "family" is established, and the implementation of the strategy begins.[16] | ||
| 1988 | Fidelity 500 Index Fund is launched.[20][11] | ||
| 1990 | The First Index Investment Trust, renamed the Vanguard 500, reaches U$1 billion in assets 1990.[14] | ||
| 1990 | Vanguard launches an extended market index, tracking the Wilshire 4500 Index, which is composed of all investable U.S. stocks not held in the S&P 500.[17] | ||
| 1991 | Galaxy Funds opens an index fund of govenment long bonds.[18] | ||
| 1991 | Charles Schwab Co. opens its Short-Term Bond Market Index.[18] | ||
| 1992 | The Vanguard Total Stock Market Index Fund is designed to provide investors with exposure to the entire U.S. equity market, including small-, mid-, and large-cap growth and value stocks.[21] | ||
| 1993 | Vanguard creates the first specific-maturity bond index funds. The Long-Term Bond, Intermediate-Term Bond, and Short-Term Bond Portfolios of Vanguard Bond Index Fund are modeled after the comparable segments of the Lehman Brothers Aggregate Bond Index.[16][18] | ||
| 1994 – 1996 | The index fund concept becomes firmly established in the minds of serious investors, and gains considerable attention in the press.[16] | ||
| 1995 | The founders of Victoria Capital Management (a venture capital firm specializing in growth stage companies) create an active asset allocation model using a variety of indexed funds. The structure of a range of portfolios with different weightings allows for the active management of these indices based on long‐term return characteristics and traditional economic and market analyses.[6] | ||
| 1995 | Literature | Vanguard publishes a booklet titled The Triumph of Indexing, which describes the whys and wherefore of the remarkable success of the concept of indexing.[4] | |
| 1996 | Warren Buffet writes in the Annual Report of Berkshire Hathaway Corporation:
Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) delivered by the great majority of investment professionals.[11] | ||
| 1996 | Vanguard launches the Total International Portfolio as a "fund of funds", a composite of underlying European, Pacific, and Emerging Markets Portfolios.[16] | ||
| 1997 | The acceptance of index funds accelerates.[16] | ||
| 1999 | Index Fund Advisors is founded in California as an investment advisory and wealth management company.[22][23] | ||
| 2007 | To date, the Vanguard 500 Index Fund remains the largest mutual fund in the world.[5] | ||
| 2008 | Warren Buffett makes a bet that an S&P 500 index fund would beat a basket of actively managed hedge funds over 10 years. By the end of 2017, it would be clear Buffett won the bet.[24] | ||
| 2012 (June) | As of date, there are about 1200 index ETFs in the United States, with about 50 actively managed ETFs. Index ETF assets are about US$1.2 trillion, compared with about $7 billion for actively managed ETFs.[25] | ||
| 2017 | Bitwise establishes the world’s first cryptocurrency-based index fund, called the Bitwise 10 Private Index fund. Its approach is based on the cryptocurrencies in their Bitwise 10 Large Cap Crypto Index — a collection of the ten largest coins, weighted by their 5-year diluted market capitalization. The index includes Bitcoin, Ethereum, Ripple, EOS, Litecoin, Bitcoin Cash, Steller, Dash, Monero, and Zcash.[2] |
Meta information on the timeline
How the timeline was built
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What the timeline is still missing
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See also
External links
References
- ↑ Fox, Justin (2011). "Chapter 7: Jack Bogle takes on the performance cult (and wins)". The Myth of the Rational Market. USA: HarperCollins. pp. 111–112. ISBN 978-0-06-059903-4.
- ↑ 2.0 2.1 2.2 2.3 2.4 "The History of Index Funds & The Future of Diversifying Your Crypto Investments". medium.com. Retrieved 16 April 2019.
- ↑ "INDEX FUND". alphazadvisors.com. Retrieved 22 April 2019.
- ↑ 4.0 4.1 4.2 "The First Index Mutual Fund: A History of Vanguard Index Trust and the Vanguard Index Strategy". vanguard.com. Retrieved 22 April 2019.
- ↑ 5.0 5.1 5.2 5.3 5.4 Carrel, Lawrence. ETFs for the Long Run: What They Are, How They Work, and Simple Strategies for Successful Long-Term Investing.
- ↑ 6.0 6.1 6.2 "The Value of Active Index Management" (PDF). vcm.us.com. Retrieved 22 April 2019.
- ↑ "The Vanguard Group Of Investment Companies". encyclopedia.com. Retrieved 22 April 2019.
- ↑ "John C. Bogle, Founder of Financial Giant Vanguard, Is Dead at 89". nytimes.com. Retrieved 22 April 2019.
- ↑ "A look back at the life of Vanguard's founder". investornews.vanguard. Retrieved 22 April 2019.
- ↑ Johnson, Bruce. The Hedge Fund Fraud Casebook.
- ↑ 11.0 11.1 11.2 11.3 11.4 "Vanguard's index funds: A history of evolution for investors". foxbusiness.com. Retrieved 16 April 2019.
- ↑ "A Brief History of Indexing". morningstar.com. Retrieved 16 April 2019.
- ↑ "This Day In Market History: Vanguard Launches First Index Fund For US Retail Investors". benzinga.com. Retrieved 16 April 2019.
- ↑ 14.0 14.1 "Today in Market History, The First Index Fund". theirrelevantinvestor.com. Retrieved 16 April 2019.
- ↑ "Father of passives has doubts about ETFs". ft.com. Retrieved 16 April 2019.
- ↑ 16.0 16.1 16.2 16.3 16.4 16.5 16.6 Neubert, Albert S. Indexing for Maximum Investment Results.
- ↑ 17.0 17.1 Ferri, Richard A. The Power of Passive Investing: More Wealth with Less Work.
- ↑ 18.0 18.1 18.2 18.3 Martellini, Lionel; Priaulet, Philippe; Priaulet, Stéphane. Fixed-Income Securities: Valuation, Risk Management and Portfolio Strategies.
- ↑ Neuberg, Albert S. Indexing for Maximum Investment Results.
- ↑ "Fidelity 500 Index Fund". bloomberg.com. Retrieved 22 April 2019.
- ↑ "Vanguard Total Stock Market Index Fund Investor Shares (VTSMX)". investor.vanguard.com. Retrieved 18 April 2019.
- ↑ "Careers at Index Fund Advisors". ifa.com. Retrieved 22 April 2019.
- ↑ "Mark Hebner". ifa.com. Retrieved 22 April 2019.
- ↑ "Why Index Funds Should Be Every Investor's Best Friend". moneywise.com. Retrieved 15 April 2019.
- ↑ "ETF Statistics For June 2012: Actively Managed Assets Less Than 1%". ETF Daily News. Archived from the original on December 12, 2017. Retrieved December 12, 2017.
