Vanguard today introduced its first active bond ETF, managed by its in-house fixed income team. The
Vanguard Ultra-Short Bond ETF (VUSB) offers a low-cost, diversified option for investors seeking income and limited price volatility. The ETF, which is listed on the Chicago Board Options Exchange (Cboe), has an expense ratio of 0.10%, compared to a categorical average of 0.22%.
The “Vanguard Ultra-Short Bond ETF offers the features of an ETF structure for investors seeking an option for anticipated cash needs in the range of 6 to 18 months,” said Kaitlyn Caughlin, head of Vanguard Portfolio Review Department. “An ultra-short strategy bridges the gap between money market funds offering a stable share price and short-term bond funds, which are meant for longer investment time horizons.”
Vanguard Lowers Fees for Target Retirement Trusts
Vanguard has announced it is lowering fees for its Target Retirement Trusts by 5% to 10% across the board, saving investors an estimated $20 million.
Effective as of April 1, fees will fall between 0.25 basis points (bps) and 0.5 bps, depending on which program a client is invested in.
This fee reduction for Vanguard Target Retirement Trusts follows Vanguard’s announcement in December of new lower minimums for the Vanguard Institutional Target Retirement Funds. The lower minimums saved investors an estimated $16 million as more participants gained access to lower-priced funds.
Vanguard Target Retirement Trusts are organized as collective investment trusts (CITs), a type of pooled account that capitalizes on the economies of scale of larger workforces to lower costs. The trusts offer multiple price points so clients can reap the benefits of lower fees as plan assets grow.
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Vanguard Announces Plans to Launch Ultra-Short Bond ETF
Vanguard has filed an initial registration statement with the Securities and Exchange Commission (SEC) to launch the Vanguard Ultra-Short Bond ETF.
The actively managed exchange-traded fund (ETF) will offer a low-cost, diversified option for investors seeking income and limited price volatility. Vanguard Fixed Income Group will serve as investment adviser to the new ETF, which is expected to launch in the second quarter of 2021.
“We are excited to present investors with a new solution for managing short-term cash needs and to offer our world-class active fixed income expertise through an ETF,” says Kaitlyn Caughlin, head of Vanguard Portfolio Review Department. “Vanguard’s history of competitive active performance is enabled by rigorous fund oversight, access to a diverse roster of active management talent and our ability to keep costs low.”
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VALLEY FORGE, Pa., Jan. 19, 2021 /PRNewswire/ Vanguard today filed an initial registration statement with the Securities and Exchange Commission to launch Vanguard Ultra-Short Bond ETF. The actively managed ETF will offer a low-cost, diversified option for investors seeking income and limited price volatility. Vanguard Fixed Income Group will serve as investment advisor to the new ETF, which is expected to launch in the second quarter of 2021. We are excited to present investors with a new solution for managing short-term cash needs and to offer our world-class active fixed income expertise through an ETF, said Kaitlyn Caughlin, head of Vanguard Portfolio Review Department. Vanguard s history of competitive active performance is enabled by rigorous fund oversight, access to a diverse roster of active management talent, and our ability to keep costs low.