George Upham Sauter

From Bogleheads

George Upham Sauter
Mansfield Ohio
NationalityUnited States
Other namesGus
Alma materUniversity of Chicago
OccupationInvestment manager
Years active1987 - 2012
EmployerThe Vanguard Group

George U. "Gus" Sauter is noted as the head investment manager of Vanguard index funds from 1987 through 2003, and as the creator of Vanguard's exchange-traded funds.

Early life and education

Sauter was born in 1954 to Jean Upham and George Sauter in Mansfield Ohio.[1]

At age eight, he started taking deposits and making loans for his Cleveland neighbors; he was eleven when he bought shares in the Cleveland Cavaliers. He earned an A.B. in economics from Dartmouth College and an M.B.A. in finance from the University of Chicago.[2] In 1976 Sauter took his first job with Chiquita Banana—the United Brands Company. This job lasted one year. He next worked for the First National Bank of Boston. While studying at Chicago University, Sauter worked for a small real estate company, both in Chicago and Denver. While employed with the real estate firm, Sauter put together a venture capital deal and formed a gold mine.[3]


Sauter began his career in investment management as a trust investment officer with First Bancorp of Ohio (formerly The First National Bank of Ohio) and joined Vanguard in 1987. He was hired two weeks before the October 1987 market crash. At Vanguard he was given the reins to a nascent Quantitative Equity group and was the head investment manager of the firm's equity index funds. At the time, Vanguard's lone equity index fund and lone bond index fund held 1.4 billion dollars, representing just 3% of Vanguard's asset base.[4][5]

Under Sauter's direction, Vanguard expanded its line-up of equity index funds. In addition, he helped develop new trading programs and strategies that minimized trading costs and enhanced benchmark tracking precision. [4][6]

Sauter also oversaw development of Vanguard's active Quantitative Equity Group, which now manages 15 Vanguard active funds.

From 2003 through 2012, Sauter served as Vanguard’s chief investment officer. In that role, he was responsible for the oversight of approximately $1.7 trillion managed globally by Vanguard Fixed Income and Equity Investment Groups.[7]

In 2003 Sauter helped create Vanguard's foray into exchange-traded funds (ETFs) when he developed a structure under which ETFs are offered as a separate share class of existing Vanguard index funds.[4][8] Vanguard patented this structure in 2005.[9]

Sauter announced his retirement, effective December 31, 2012, on June 22, 2012.[4]

Professional advisory and committee roles

During his career, Sauter served on the advisory board of the Journal of Investment Management Conference Series, the Journal of Indexes Editorial Board, the Investor Advisory Group of the Public Company Accounting Oversight Board, and the Council on the Graduate School of Business of The University of Chicago.

He served as a member of the equity markets committee of the Investment Company Institute, the Institutional Traders Advisory Committee of the New York Stock Exchange, and the Nasdaq Quality of Markets Committee. He also has served on the trading committee of the Securities Industry Association, Securities Industry and Financial Markets Association (SIFMA), and the AIMR Best Execution Task Force.[10]

Bogleheads conference presentations

Mr. Sauter has delivered presentations at the Bogleheads® Conferences since 2014.

Conference date Presentation
October 24, 2014 The Evolution of Indexing
October 17, 2015 Expected equity returns
September 30, 2016 What really is smart β

Audio: Smart Beta (audio), produced by digarei.

October 20, 2017 Understanding Active Investing
October 5, 2018 The Endowment Model


  1. Jean U. Sauter obituary
  2. Janet Paskin (October 6, 2012). "A New Vanguard for Gus Sauter". Barrons.
  3. Sauter interview, CFA Institute
  4. 4.0 4.1 4.2 4.3 Press release, Vanguard 22 June 2012
  5. Drew Voros (December 21, 2012). "Retiring Vanguard CIO Gus Sauter Looks Back".
  6. William Bernstein (Fall 2000). "Selection Skill, Transactional Skill". Efficient Frontier.
  7. Gus Sauter, Vanguard Blog
  8. "New Vanguard Vipers Put A New Twist On ETFs With Separate Share Classes". October 1, 2003.
  9. US 6879964 B2, google Patents
  10. Market Structure Roundtable - Panelists' Biographies,SEC

External links