Vanguard launched the first U.S. index fund for individual investors in 1976.
The fund was originally called First Index Investment Trust and was created under the leadership of John C. Bogle. It later became Vanguard 500 Index Fund, designed to track the performance of the S&P 500 rather than rely on a manager to select individual stocks. The launch followed Vanguard's earlier creation in 1975.
The fund initially attracted little money and was sometimes criticized as a vehicle that would merely match the market. Its low-cost, passive approach eventually became highly influential. Vanguard is organized in a distinctive way: its funds own the investment management company, and fund investors therefore indirectly own Vanguard. The firm is widely associated with mutual funds and exchange-traded funds, while its enormous assets under management should not be confused with its own market capitalization, because Vanguard is not a publicly traded corporation.