Bloomberg Talks: Vanguard CEO Salim Ramji Talks ETF Fee Cuts

Date: February 2, 2026
Host(s): Bloomberg (Katie, Scarlett, Eric)
Guest: Salim Ramji, CEO of Vanguard

Episode Overview

In this engaging interview, Vanguard CEO Salim Ramji joins the Bloomberg team on their relaunch day to discuss the company’s latest fee cuts, the balance between lowering costs and investing in client services, expansion into active management, international ambitions, and thoughts on U.S. economic policy leadership. The conversation offers insights into how Vanguard’s client-owned structure shapes its priorities and strategies, and how the firm is evolving to meet client needs in a rapidly changing financial landscape.

Key Discussion Points & Insights

1. Vanguard’s Ongoing Commitment to Fee Cuts

[00:37 - 02:02]

• Big Announcement: Vanguard has announced yet another round of ETF fee cuts, bringing the average asset-weighted fee from 7 to 6 basis points.

• Frequency of Fee Cuts: This is the 2,200th fee reduction in the company’s history, underlining their ongoing commitment to low costs.

  “It was a very unoriginal act from Vanguard... by our count, it was the 2200th time in which we’ve announced fee cuts since our founding.”
  — Salim Ramji [01:08]

• Client-Owned Structure: As a client-owned company, surpluses are used to both lower fees and invest in technology and services, not to pay external shareholders.

  “Because of our client ownership structure... whenever we generate a surplus... we’re able to do a couple of things. First, we’re able to invest back into important technologies... and we're able to give clients back a better deal through reduced fees.”
  — Salim Ramji [01:18]

2. Active vs. Passive Funds & The "Cost Matters Hypothesis"

[02:02 - 04:18]

• Vanguard’s Roots: While known for passive index funds, Vanguard is expanding its range of active funds, emphasizing that low costs are significant drivers of client success—whether in passive or active investing.

• Performance with Low Fees: Vanguard’s actively managed fixed income funds have delivered high performance due to low cost hurdles—88% outperforming peers over ten years.

• Bogle’s Influence: Ramji credits founder Jack Bogle’s perspective on costs as a central guide, noting Bogle actually launched more active funds than his successors.

  “Bogle’s cost matter hypothesis really put into the central kind of focus for us that it’s costs that matter... If you look at one of the biggest predictors of long term performance in active management as well as in index management, it really is about the cost you charge.”
  — Salim Ramji [02:30, 03:33]

  “In investing... you get what you don’t pay for.”
  — Salim Ramji, quoting Jack Bogle [03:57]

3. Balancing Fee Reductions with Service & Technology Investments

[04:18 - 05:45]

• Investing in Client Experience: In response to critiques about platform reliability and service, Ramji emphasizes increased investments in both technology and service quality, enabled by surplus.

  “Alongside the fee reductions, we’re also increasing our investments back in our client and our client service by more than half...”
  — Salim Ramji [04:55]

• Upcoming Improvements: Announced new websites, digital redesigns, and AI-driven personalized services for clients.

• Recognition: Vanguard ranked #1 in DIY client satisfaction by JD Powers.

  “We have a whole series of initiatives underway in terms of the applications of artificial intelligence to help make our client experience even better, even more personalized.”
  — Salim Ramji [05:16]

4. Vanguard’s View on Government “Trump Accounts” for Children

[05:45 - 07:18]

• Policy Context: The U.S. government is considering allowing Robinhood to manage new accounts for children (“Trump accounts”), with major brokerages like Vanguard reportedly not considered yet.

• Ramji’s Position: Ramji avoided commenting on private government discussions but strongly endorsed the underlying concept.

• Alignment with Vanguard Philosophy: He commended the focus on early, low-cost, diversified investing as being fully in sync with Vanguard’s long-standing principles.

  “...it helps people invest early, in this case, right from when they’re born. It does it in a low cost way... stay diversified and invest for the long term. And so I think this is another innovation in being able to help with that.”
  — Salim Ramji [06:33]

5. Challenges and Strategy for International Expansion

[07:18 - 08:52]

• Current Position: International business is still a small part of Vanguard but growing rapidly, especially in the UK, Canada, and Australia.

• Barriers: Investing is perceived as too complex and costly overseas; infrastructure like in the U.S. is lacking.

• Education/Access Focus: Vanguard is focused on making investing simple, low-cost, and accessible; helping savers become first-time investors.

• International Partnerships: Growth is occurring, in part, through independent fee-based advisors.

  “Most investors just find investing too complicated, they find it too costly... what we’re helping investors in those markets do is be able to move from being savers... to be investors for the first time.”
  — Salim Ramji [07:53]

6. Thoughts on New Federal Reserve Chair Nominee (Kevin Marsh)

[08:52 - 09:34]

• Vanguard’s Influence: Vanguard is now the largest shareholder in many U.S. companies, making their views on U.S. economic leadership influential.

• Ramji’s Take: He expresses confidence in the nominee, emphasizing the importance of the Fed’s dual mission for long-term economic stability.

  “I think the most important thing is the Fed continues to stay focused on its dual mission. I know Kevin, I think he’s a great choice... it’s going to serve investors well for the long term.”
  — Salim Ramji [09:09]

Notable Quotes & Memorable Moments

• On Fee Cuts:
  “It was a very unoriginal act from Vanguard... it was the 2200th time in which we've announced fee cuts since our founding.”
  — Salim Ramji [01:08]

• On Low Costs and Performance:
  “In investing, you get what you don’t pay for.”
  — Salim Ramji, quoting Jack Bogle [03:57]

• On Technology Investment:
  “We have a new website and digital design plan that we’re going to be launching later this year.”
  — Salim Ramji [05:13]

• On ‘Trump Accounts’:
  “Keep costs low, stay diversified and invest for the long term. And so I think this is another innovation in being able to help with that.”
  — Salim Ramji [06:33]

Important Timestamps

• Vanguard fee cut announcement: [00:37 – 02:02]
• Active vs. passive funds and costs: [02:02 – 04:18]
• Client experience, service, and tech investments: [04:18 – 05:45]
• Thoughts on government children’s investment accounts: [05:45 – 07:18]
• International expansion challenges and strategy: [07:18 – 08:52]
• Views on the new Fed chair nominee: [08:52 – 09:34]

Episode Takeaway

This episode provides a comprehensive look at how Vanguard is maintaining its foundational focus on low fees while simultaneously ramping up investment in technology and client service. Salim Ramji’s leadership emphasizes the central strategy of keeping costs low regardless of investment style, the importance of adapting to global markets, and the company’s engagement with public policy to further democratize investing. The candid, insightful answers offer a clear window into Vanguard’s evolving philosophy and operations as it aims to serve a growing, global investor base.