(Bloomberg) -- Asset managers hoping 2021 might bring some respite to the fee war are in for disappointment, if Vanguard Group’s latest exchange-traded fund is anything to go by.
The $7.1 trillion investment giant this week filed plans for the Vanguard Ultra-Short Bond ETF, which will track high-quality fixed-income securities and is expected to begin trading next quarter.
The average cost of similar funds is about 0.22%, but Vanguard -- whose low-cost approach helped it dominate ETF flows last year -- is charging less than half that for the new actively managed offering. Its 0.10% expense ratio compares with 0.18% for the $15.9 billion JPMorgan Ultra-Short Income ETF (ticker JPST) and 0.35% on the $14.4 billion PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT).
“Cost is one of the important factors that you see guiding investor choices,” said Rich Powers, Vanguard’s head of ETF product, in a phone interview. “Low cost products are increasingly winning the lion’s share of the investor assets.”
Vanguard ETFs attracted a record $200 billion last year, with the passively managed Vanguard Total Stock Market ETF (VTI) leading the way. That fund carries an expense ratio of just 0.03%.
While the Malvern, Pennsylvania-based firm is known as a pioneer in index investing, its active management credentials are less-well established. The ultra-short fund will be its first active ETF to launch since 2018 and will fill a gap in Vanguard’s ETF lineup, Powers said.
“We have have an offering in most every place an investor would want to build a diversified portfolio,” he said. “But in that space that toggles between money markets and short term bonds, we didn’t have an offer.”
Últimas Noticias
Debanhi Escobar: they secured the motel where she was found lifeless in a cistern
Members of the Specialized Prosecutor's Office in Nuevo León secured the Nueva Castilla Motel as part of the investigations into the case
The oldest person in the world died at the age of 119
Kane Tanaka lived in Japan. She was born six months earlier than George Orwell, the same year that the Wright brothers first flew, and Marie Curie became the first woman to win a Nobel Prize
Macabre find in CDMX: they left a body bagged and tied in a taxi
The body was left in the back seats of the car. It was covered with black bags and tied with industrial tape
The eagles of America will face Manchester City in a duel of legends. Here are the details
The top Mexican football champion will play a match with Pep Guardiola's squad in the Lone Star Cup
Why is it good to bring dogs out to know the world when they are puppies
A so-called protection against the spread of diseases threatens the integral development of dogs
