Vanguard unveils new ETFs
By Vishal Teckchandani
Friday 15 May 2009
The new products include the Vanguard Australian Shares Index ETF, Vanguard All-World ex-US Shares Index ETF and Vanguard US Total Market Shares Index ETF.
The Australian Shares Index ETF's investment objective is to match the total return of the S&P/ASX 300 Index before fees and expenses.
The product's management fee is 0.27 per cent a year.
The All-World ex-US Shares Index ETF's investment objective is to track the performance of the FTSE All-World ex-US Index, which includes about 2200 stocks of companies from 46 countries, including developed and emerging markets, but excluding the United States.
The product's management cost is 0.25 per cent a year.
The US Total Market Shares Index ETF's investment objective is to track the performance of the MSCI US Broad Market Index, which represents around 99.5 per cent of the total market capitalisation of all exchange-traded US stocks.
The product's management cost is 0.09 per cent a year.
An investor who puts $100,000 into the two international Vanguard ETFs with a 50/50 split will gain coverage of around 6600 securities or around 93 per cent of the world's investible share market at a cost of just 0.16 per cent.
"Our initial product offer will deliver a high-value, cost-effective solution for investors," Vanguard head of retail Robin Bowerman said.
"ETFs provide an alternative method of accessing the powerful benefits of indexing. As a pioneer of indexing, Vanguard sees ETFs as a logical extension of our core product offering, allowing investors more choice in how they invest in our underlying index funds.
"Increasingly, financial advisers are using ETFs as a versatile tool to customise client portfolios while at the same time reducing risk through diversification and reducing costs."
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