What is the strongest predictor of mutual fund or ETF performance?
"Everyone knows cost is the great differentiator," said Jack Bogle, Vanguard Group founder.
The research on fees has been out there for a long time. Bogle has been the leading purveyor of it. But there's a less-covered area of research in which Bogle has been active that's just as interesting. Sit down for this one: Bogle's research shows that fees aren't everything. His research even includes Bogle recommending some active managers.
Bogle does a regularly updated analysis that looks at the correlation between quality (performance over time) and the average expense ratio of the funds in the 50 top mutual fund families. From that analysis, Bogle comes up with a list of the top mutual fund companies for creating high-quality funds. In the past decade, based on Bogle's analyses, the list includes Loomis Sayles, T Rowe Price, USAA, TIAA-CREF and Vanguard.