- Salim Ramji took over as firm’s first-ever outsider CEO
- The new chief has no plans to try to take Vanguard public
Vanguard Group Chief Executive Officer Salim Ramji said his firm is “really about” low-cost investing, and that he’d eventually like that to carry into the world of private assets.
“Low-cost investing applies in index, and it applies in active — and I would like it over time to also apply in private assets,” Ramji said in an interview Monday on Bloomberg TV. He’d also “never” attempt to take the asset manager public, he said.
Ramji took over as CEO in July as the first-ever outsider to lead the company. The new chief executive, a onetime potential successor to BlackRock Inc. CEO Larry Fink, was picked to helm $9.5 trillion-asset Vanguard at a pivotal moment for the asset-management industry and in the company’s own history.
After a decade when investors shifted heavily to low-cost index funds investments like the kind Vanguard popularized, money managers are chasing new sources of revenue. These firms are touting active strategies and trying to expand in private credit, infrastructure and alternative assets for institutional and wealthy retail clients.
“What we’re really about is low-cost investing,” Ramji said. “There is a broader universe to which we can apply that.”
Under Jack Bogle’s leadership from 1975 to 1995, Vanguard revolutionized investing by marketing the concept of cheap and efficient index funds to the masses.
But in recent years, Vanguard has struggled to expand beyond its traditional core of index funds. It has tried to build a financial advisory business to tap into new clients and revenue. Its technology has been criticized in recent years for a series of glitches and being difficult to use.
On the international front, Vanguard has aimed to carry its low-cost mission of investing to new countries, offering index funds and exchange traded funds. Ramji said Monday he also sees more investing opportunities in Europe. The firm has pulled back in some areas, notably shuttering its business in China.
Written by: Silla Brush and Katie Greifeld — With assistance from Sonali Basak and Matthew Miller @Bloomberg
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