Vanguard has a new captain at its helm. Salim Ramji has defected from competing fund management goliath BlackRock. His recent visit to Australia included a discussion with Jonathan Shapiro in partnership with the American Chamber of Commerce.

Vanguard is a household name as the key proponent of passive investing which has taken over the investing world. Salim explained that Vanguard’s mission is central to the way that the company operates. It is investor-focused, and profits are directly invested back into the business to lower prices for the investors in their products.

During the discussion Salim discussed three principles that I found particularly insightful. I think all investors can benefit from these principles to help improve their investing outcomes.

You can still find success even if you’re not first

Private markets are a hot topic. Many investors want access to the much lauded benefits of private markets. However, there have been high barriers to entry for retail investors and fee levels that are inconsistent with Vanguard’s typical approach.

Although Vanguard sees opportunity in private markets, they are yet to enter. Salim spoke about how it is not always about being first. Many fund managers have already launched private market products, but Vanguard takes a different approach by focusing on getting the structure and cost right rather than rushing to market. He notes that Vanguard has historically been second or third in launching products but ensures that anything they introduce is of high quality and low cost for the long term.

This measured approach is an important lesson for investors. Chasing the latest trends or rushing into investments isn’t always the best strategy. The investment industry continues to try to meet the market’s insatiable demand for new investment products. Thematic and niche sector or factor ETFs are released frequently. These investments try to attract investor’s funds by appealing to the latest fads or trends.

The issue is that by the time a theme is discovered, a product is conceptualised and brought to market it may be too late to profit. It is almost impossible for investors to be ‘first’ in a trend or company, especially in developed markets like the US and Australia where our markets operate at a high level of efficiency.

Instead of trying to be first, success can be found through patience and a focus on fundamentals. This is a more sustainable way to invest and can lead to better long-term outcomes.

Markets (and investors) like certainty

Salim highlighted that uncertainty is one of the biggest challenges in investing. Markets react strongly to changes in government policies, interest rates, and trade agreements, but over the long term, staying the course is rewarded.

Salim believes that the tumult shaking markets is due to uncertainty. In aggregate, investors do not have strong feelings as to how they hope Trump’s tariffs play out. Salim feels as soon as investors have a clear understanding of the tariffs and its impact the volatility will settle, as they will have an understanding of the environment going forward.

He reflects on the shift in global trade and economic policies, drawing parallels between the early 1990s era of expanding free trade and the current period of geopolitical rebalancing. While short-term volatility is inevitable, the long-term success of investors often depends on maintaining confidence in economic growth. He believes that this period of volatility that we are seeing is temporary.

The data backs this up.

Market events and their impact

Before, during and after major market events, there is always a period of uncertainty and market volatility. Volatility is the enemy of many investors for two reasons. The first, is that it encourages poor investor behaviour. We’ve conducted research on how investors chase returns, selling out of investments to the detriment of their total returns. The second is the impact on investors who are drawing down on their portfolios, either through dividends or selling positions.

This is why it is particularly important for those in retirement to structure their portfolios correctly given they are drawing down their savings We’ve written extensively on bucket portfolios to increase the longevity of retirement portfolios and help protect it from sequencing risk, volatility and longevity risk.

This usually corrects within a year, and always corrects over the long-term, with markets trending upwards.

For investors, it is important to zoom out of current events and focus on the long-term. It is also why investors should carefully consider how they diversify. Investors who put all their money into a single market, sector, or asset class are at greater risk of being negatively impacted by uncertainty.

Investor behaviour and simplicity matter more than market timing

Vanguard is known for being a proponent of simple, low-cost, and disciplined investing. Salim reinforced this by emphasising that investor behaviour has a greater impact on long-term returns than trying to time the market.

This is how I invest. I focus on staying invested, asset allocation, controlling my own behaviour and keeping fees low. He believes that this has a greater impact on long-term returns than trying to time the market.

He also spoke about the broader impact of investing on the economy. When more people participate in the markets, they become more engaged in economic growth, fostering optimism and long-term thinking. This, in turn, helps build stronger financial markets and economies.

Final thoughts

Salim believes in a deliberate approach. It is resisting the urge to chase the latest investment trend, ignoring market noise or focusing on simplicity with your investment portfolio. Valuable insights from a man responsible for $16 trillion that resonates with the way that I think about investing.

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