Jack Bogle's 'lazy' investing strategy is gaining popularity again.

• As the meme-stock rally fades, investors are rediscovering the investment philosophy of Jack Bogle.
• "Bogleheads" are fans of "lazy" investing, which is gaining popularity among higher interest rates.
• Vanda Research's senior vice president, Marco Iachini, stated that income-seeking retail investors are utilizing the new high-rate regime, which some refer to as 'T-Bill and chill'.

Boring investing is making a comeback.

As the meme-stock rally fades and interest rates rise, investors are turning to the investment philosophy of Jack Bogle, the founder of Vanguard. Bogle's approach emphasizes low-cost, passive investments that grow over time. Supporters of this strategy call themselves "Bogleheads," and it is often referred to as "lazy" investing.

Despite the difficulties in timing this year, the S&P 500 has gained eight days, accounting for all of its gains. Higher rates have negatively impacted tech and growth stocks, which were previously popular among retail traders during the pandemic. The original meme trade, which was once a popular investment, has experienced a significant decline, down roughly 85% from its all-time high.

Dan Griffin, a self-proclaimed Boglehead residing in Florida, stated that he observed the meme stock rally with amusement. The current market situation serves as evidence that his "tortoise" investing strategy is the best way to accumulate long-term wealth, he added.

Griffin stated to CNBC, "I am content being the unexciting investor, the slow and steady one. Although the hare may occasionally win, the tortoise typically emerges victorious in the end."

Morningstar's director of personal finance and retirement planning, Christine Benz, stated that investors are currently drawn to higher yields in order to obtain value, which aligns with the core principle of the Bogleheads.

Bogleheads are long-term investors who add money to their accounts and avoid touching or monitoring their investments for an extended period of time, typically 30 years. In contrast, the meme stock phenomenon emphasizes being highly engaged in monitoring and adjusting investments.

Wall Street Bets to Bogleheads

A brokerage firm that was once associated with day trading is now shifting towards higher yields and a more long-term perspective.

This year, the company introduced retirement accounts and offers a 3% cash back incentive as part of an effort to shift away from declining trading fees. According to Robinhood's co-founder and CEO Vlad Tenev, who spoke to CNBC, investors have been moving into cash, money market funds, and bond ETFs. Tenev observed that there has been more discussion on the Bogleheads' Reddit group compared to the notorious Wall Street Bets group.

Robinhood has been frequently discussed in traditional passive investing forums, such as Bogleheads on Reddit, over the past few months. Notably, individuals are utilizing the platform to construct long-term portfolios while benefiting from its improved economics and available tools.

Retail investors have attempted to capture rising interest rates through the use of Bond ETFs. Last week, it was the third most-bought name after and , according to Vanda Research. The ETF experienced its largest single-day of net inflows since the firm started tracking it nearly a decade ago.

Income-seeking retail investors are taking advantage of the new high-rate regime, which had been absent from the investment landscape since the pre-GFC years, according to Marco Iachini, senior vice president of Vanda Research, who referred to it as "T-Bill and chill."

Millennial ETF investors have a higher exposure to fixed income compared to their older counterparts, with 45% of their portfolios in fixed income compared to 37% for Generation X. Additionally, a survey revealed that 51% of millennials plan to invest in bond ETFs next year, compared to 40% of baby boomers.

The transition to fixed income may carry some risks, despite not being a meme stock.

This year, $19.8 billion in assets have flooded into the bond market, according to BlackRock. If bond yields rise, funds like TLT will suffer, as yields move inversely with prices. This has been the case this year, with TLT falling about 50% from its record high. However, if yields decline, bond funds should outperform.

Jack Bogle is the founder of index investing.