Jack Bogle's Index Fund Portfolio and How Warren Buffett Bet that Index Fund Investing would Beat Hedge Funds

John Clifton "Jack" Bogle is known as the common sense investor. He started the first index fund in 1975 which is in my opinion the only intelligent way for most of us to invest. Our fortunes grow as the nation's fortunes grow. All while giving less money to the big investment firms and banks.

The power of the index fund method was illustrated by a bet that Warren Buffett made with hedge fund managers. Mr. Buffett bet $1 million that he would beat their returns by investing in an index fund. Warren Buffett won.[3-5.]

Below are his eight basic rules for investors:^[1]

1. Select low-cost funds
2. Consider carefully the added costs of advice
3. Do not overrate past fund performance
4. Use past performance to determine consistency and risk
5. Beware of stars (as in, star mutual fund managers)
6. Beware of asset size
7. Don't own too many funds
8. Buy your fund portfolio - and hold it

Below is his suggested portfolio along with suggestions for asset allocation based on age.[2.]

Sources:

1. Sigma Investing. Review of Common Sense on Mutual Funds.

2. http://www.npr.org/2015/10/17/436993646/three-investment-gurus-share-their-model-portfolios
3. http://www.npr.org/2016/03/10/469897691/armed-with-an-index-fund-warren-buffett-is-on-track-to-win-hedge-fund-bet
4. https://www.bloomberg.com/view/articles/2017-05-03/why-i-lost-my-bet-with-warren-buffett
5. http://www.npr.org/sections/money/2016/03/04/469247400/episode-688-brilliant-vs-boring