First Mutual Fund: Eendragt Maakt Magt

Dutch broker Abraham van Ketwich launched the first “mutual fund” in 1774. The fund was named “Eendragt Maakt Magt”, which translates to “Unity Creates Strength”. van Ketwich launched the fund shortly after the financial crisis of 1772, in which Dutch banks were brought to the brink of collapse due to concentrated bets on British East India Company stock, which had tanked that summer. This proved a valuable lesson on the merits of diversification.


The fund consisted of 50 bonds that were equally weighted and diversified across 10 different categories/sectors (banks, turnpikes, etc.). The fund also had a low expense ratio of 0.20%.


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