The Federal Reserve's bond-buying stimulus program is not the reason the stock market has rallied, at least not in the way most think, mutual fund pioneer Jack Bogle told CNBC on Wednesday.
Instead it has been the "remarkable" strength of corporate America that has been driving the market, he said. However, low interest rates have helped businesses grow.
By keeping interest rates low, "you're reducing a major corporate cost. That's one reason the earnings are so good," he added. That gave investors a "nice bump of confidence."
Bogle pointed out that the market is up about 50 percent since the end of 2007, and dividends and earnings are both up about 45 percent.
Many have said the market's rally has been fueled by the Fed's quantitative easing policy, which kept interest rates low and therefore led investors to seek higher returns from stocks over low-yielding bonds.
Some seeking higher yields have turned to new products like exchange-traded funds linked to high-yield bonds. However, Bogle, who is No. 9 on CNBC's First 25 List, had a word of caution for investors.
"What investors have to be careful about is crawling out so far out on that limb to get more yield that the limb doesn't snap off and they're all of a sudden on the ground," he said.
"I'd worry and I'd give a lot of attention to the risk involved in these new instruments designed to improve yield and I think most of them should not be bought."
—By CNBC's Michelle Fox