John 'Mac' McQuown: The Data Will Sort That Out (EP.182)

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By Benjamin Felix & Cameron Passmore, Benjamin Felix, and Cameron Passmore. Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio is streamed directly from their servers. Hit the Subscribe button to track updates in Player FM, or paste the feed URL into other podcast apps.

One of the pillars of our approach at The Rational Reminder Podcast and PWL Capital is the idea of index investing, a concept that is both fundamental and deeply embedded. Today we are very lucky to have John 'Mac' McQuown on the show, who was behind the creation of the first equity index fund. It is hard for us to overstate just how important this contribution has been to the world of finance and any fund managers and investors that share our philosophy. Mac's work back in the 1960s, his position at Wells Fargo, and his contribution to the founding of Dimensional Fund Advisors all speak for themselves, and we are extremely grateful to get some perspectives from this titan of the world of rational and data-driven investing. In our chat, we get to hear about some of the key points in Mac's career and the general arc of the rise of indexing and diversified investing, the key figures that he worked alongside, his thoughts on the future, and the importance of environmentalism in today's world. So, to hear it all from a hero and giant in the space, be sure to listen in with us today.

Key Points From This Episode:

  • Looking back at the role of data at the beginning of Mac's career. [0:03:00.2]
  • Wall Street in the 1960s, and the amusing experiences Mac had early on. [0:04:20.6]
  • Mac's initial findings when he started analyzing institutional portfolios. [0:07:44.5]
  • Joining Wells Fargo and the team that Mac found himself on. [0:08:28.1]
  • The strong support that Mac and the quantitative approach were given at Wells Fargo. [0:13:36.7]
  • Early tracking of index funds and Mac's memories of the first index they tracked. [0:18:21.3]
  • The initial institutional responses that Mac received to his work with data. [0:20:46.5]
  • How Wells Fargo contributed to the first commercially available index fund. [0:22:24.6]
  • Mac's connection to Jack Bogle and the results of their relationship. [0:27:18.2]
  • The seeds of iShares; Mac traces the beginnings at Wells Fargo. [0:29:57.7]
  • Perspectives on why people still have belief in active investing. [0:33:19.4]
  • Mac's memories of working with David Booth during the founding of Dimensional. [0:34:41.8]
  • Differentiating between Dimensional funds and index funds. [0:36:44.3]
  • Weighing concerns about the growth of indexing and how this may affect pricing and governance. [0:39:52.5]
  • Mac's environmentalist philosophy and his thoughts on practical steps against climate change. [0:42:10.6]
  • How Mac defines success in his life and its relationship to increased curiosity. [0:45:00.2]

205 episodes