Proponents of passive investing will celebrate the event while active managers will likely try to downplay its significance. The importance of the event is far more profound than its effect on Vanguard and Fidelity. Stock funds that don't outperform it are finding it harder and harder to market their services. Index funds are already the fastest growing sector of the mutual fund business and this will possibly accelerate that trend. And if anything, individual investors have been slow to embrace passive management.
Institutional investors invest a far larger percentage of their assets passively.
In the end, hopefully all the discussions will help to educate the investing public. Many individual investors are simply uneducated and unaware of the arguments and empirical evidence supporting passive management. If nothing else, hopefully the event and the continued growth in index funds will intensify the pressure on mutual fund companies to reduce their expense ratios to better compete with index funds. Magellan originally rose to prominence under the guidance of Peter Lynch . However, Magellan dramatically underperformed during Vinik's final six months in large part due to an unfortunate bet on bonds.