How do companies like Blackrock and Vanguard make money?
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The manage investments (ie. mutual funds, direct portfolio management, etc.) and charge management fees for doing so. When you have many billions or even trillions of dollars under management, even the fractions of a percent they charge in fees add up quickly.
Vanguard is best known for their index funds, where they invest money to mirror an index like the S&P500. So they take investors’ money deposited with them and buy shares of the companies that comprise the S&P.
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