(Bloomberg) -- Vanguard smells an opportunity. The world's largest mutual-fund company is betting the passive-investment model it pioneered in the U.S. is about to seize more of a foothold in Europe, and it's lining up for a piece of the action.

Forthcoming regulations such as MiFID II will probably increase the cost of managing money in the region, likely benefiting investments that track indexes to the detriment of active products where managers are paid to pick stocks and bonds.

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