Hi,
I was watching a YouTube video. The finance YouTuber in question said that anyone who holds any of Vanguard’s ETFs or index funds owns a small portion of the company in the same way a shareholder of a company does.
BlackRock are listed on the us market and the same does not apply
Is this true.
I hold plenty of Vanguard’s ETFs and one index fund.
Seems to be true. From the Vanguard website:
Vanguard was structured to be owned by it’s own funds.
https://www.vanguardinvestor.co.uk/why-vanguard/40-years-experience
Also:
Yes this is true, it’s one of the things I love about Vanguard (see below)
The company is set up in such a way that the company is owned by its funds, which in turn is owned by its fundholders (the likes of us). It means Vanguards incentives always lie in reducing costs, and any profit generated by vanguard goes towards lowering fees. Contrast that to Blackrock, say, who are incentivised to maximise profit for shareholders (i.e. they would never lower fees for the sake of it, unless to preserve/gain market share etc).
In my opinion, this elegant, ingenious company structure, makes vanguard the most trustworthy asset management firm in the world… Jack Bogle is a hero.
Jack gets a lots of credit but I don’t think it can ever be enough.
To clarify it slightly. Vanguard Group is owned by its US domiciled funds and ETFs, which in turn are owned by their US investors. (unless you are a sophisticated investor and are able to investing US funds outside of the US)
I don’t believe Vanguard UK or elsewhere has the same company setup, but in theory benefit from the groups ownership setup.
Our unique mutual ownership structure in the US, where we are owned by our clients, means our interests are aligned with those of our investors globally. As a result, investors
in Europe benefit from Vanguard’s commitment to putting investors’ interests first. Our structure underpins our core purpose, which is to take a stand for all investors, treat them fairly and give them the best chance for investment success.