My partner, David Connelly and I are fans of business stories, how they were founded and whether or not they became successful. We are often asked how our company, Symmetry Partners, came to be. We met at a very large Wall Street brokerage firm in the early ‘90’s, Dean Witter. We learned certain things from each other and subsequently became friends. One of the things I taught David was the wisdom of index investing.
Some years earlier I had read an article by John Bogle, the Founder of The Vanguard Group of Mutual Funds. It made tremendous sense to me. In the article, Bogle referenced the book A Random Walk Down Wall Street by Princeton Economist Burton Malkiel (originally published in 1973, now in its 12th edition). Malkiel’s book in turn referenced the work of Professor Eugene Fama at the University of Chicago (now the Booth School of Business). Fama is most widely known for the Efficient Market Hypothesis, which synthesized much of the research that had been done on financial markets in the burgeoning field of Financial Economics. Fama pulled it all together and from this came the birth of index investing. Two of his MBA students at Chicago, David Booth (remember that name?), and Rex Sinquefield had gone on to put much of what they learned from Fama into practice. They simultaneously worked on the first indexing approaches at two different banks after graduation. In 1981 Booth founded Dimensional Fund Advisors and Rex joined him shortly thereafter where they continued their work on creating new types of index funds.
Back to Symmetry. David felt after a few years working for the big brokerage firm that we could do better on behalf of our clients and asked me if I would be interested in joining forces to start our own firm. This allowed us to practice financial planning, frowned upon by Wall Street in those days(!), and use Vanguard index funds for our clients which were not available at our firm. They still aren’t available at many big Wall Street firms if you can believe that. The impetus for our investment philosophy came from Jack Bogle.
The story is a fun one to tell. Today DFA manages over $600 billion and Vanguard over $5 trillion. Another Fama student, Cliff Asness, founded Applied Quantitative Research (AQR) in 1998 who now manage over $200 billion. These three firms make up the heart of the investment portfolios we create for our clients to this day and we owe much of that to Jack. We were fortunate enough to meet Jack in 2010 at his office in Malvern, PA on the Vanguard campus. It was a highlight of our professional lives. Oh, and Symmetry Partners, a two man shop with no assets under management founded in 1994? We manage over $9 billion in client assets, service more than 3,000 financial advisors, and employ over 100 great people.*
Jack Bogle passed away on January 16th, and the world is a better place because of him.
*In assets under management and advisement. Assets under advisement is where Symmetry acts as a sub-advisor. Symmetry Partners, LLC, As of December 31, 2017.
Apella Capital, LLC has an arrangement with its affiliate, Symmetry Partners, LLC, under which Symmetry makes model portfolios available to Apella for use with Apella’s clients. For additional information regarding the relationship between Apella and Symmetry, please see Apella’s ADV Part 2A located on the Apella website at www.apellacapital.com.