Vanguard Expands Fixed Income Lineup with New Actively Managed Bond ETF

VALLEY FORGE, Pa., Jan. 10, 2025 /PRNewswire/ -- Vanguard today announced plans to introduce Vanguard Short Duration Bond ETF (VSDB), an active fixed income ETF that will be managed by Vanguard Fixed Income Group. Vanguard intends to launch the ETF in early April of this year.

"The addition of VSDB to our line up underscores Vanguard's commitment to meeting the needs of our clients, providing them with access to Vanguard's world-class active investment talent at a low cost with the convenience and flexibility offered by the ETF structure," said Dan Reyes, head of Vanguard Portfolio Review Department. "Vanguard Short Duration Bond ETF adds to our growing suite of actively managed fixed income ETFs and offers investors the potential to outperform the market within their short-term fixed income allocations."

Vanguard Short Duration Bond ETF is designed to provide clients with current income and lower price volatility consistent with short-duration bonds. The new ETF will offer diversified exposure to primarily short-duration U.S. investment-grade bonds – including some exposure to structured products, such as asset-backed securities – with the flexibility to invest in below investment-grade debt and emerging markets to seek additional yield. This multi-sector approach is consistent with investors' preferences within their short-term fixed income allocations and enables Vanguard Fixed Income Group to draw upon the best ideas across a wide investable universe. Vanguard Short Duration Bond ETF will have an estimated expense ratio of 0.15%.

The ETF will be actively managed, enabling the portfolio managers to seek the best opportunities within their investable universe while remaining highly risk-aware.

A leading fixed income adviser

For more than 40 years, Vanguard Fixed Income Group has distinguished itself with deep investment capabilities, disciplined security selection processes, and rigorous risk management techniques, resulting in consistent long-term performance. Vanguard Fixed Income Group is the world's largest manager of bond mutual funds and ETFs, overseeing the full spectrum of fixed income asset classes and sectors. The team oversees more than $2.4 trillion in global assets under management and has 192 investment professionals across the globe.¹

Vanguard's track record as an investment manager remains unparalleled—95% of Vanguard active fixed income funds outperformed their peer group averages over the past ten years ended 9/30/2024.²

About Vanguard

Founded in 1975, Vanguard is one of the world's leading investment management companies. The firm offers investments, advice, and retirement services to individual investors, institutions, and financial professionals. Vanguard operates under a unique, investor-owned structure where Vanguard fund shareholders own the funds, which in turn own Vanguard. As such, Vanguard adheres to a simple purpose: To take a stand for all investors, to treat them fairly, and to give them the best chance for investment success. For more information, visit vanguard.com.

¹All figures as of November 30, 2024, unless stated otherwise.

² For the ten-year period September 30, 2024, 42 of 44 Vanguard active bond funds outperformed their peer group averages; results will vary for other time periods. Only funds with a minimum ten-year history were included in the comparisons. (Source: Lipper, a Thomson Reuters Company) Note that this competitive performance data represents past performance, which is not a guarantee of future results, and that all investments are subject to risks. For the most recent performance, visit our website at www.vanguard.com/performance.

For more information about Vanguard funds and Vanguard ETFs, visit vanguard.com to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.

Vanguard ETF Shares are not redeemable with the issuing Fund other than in very large aggregations worth millions of dollars. Instead, investors must buy and sell Vanguard ETF Shares in the secondary market and hold those shares in a brokerage account. In doing so, the investor may incur brokerage commissions and may pay more than net asset value when buying and receive less than net asset value when selling.

All investing is subject to risk, including the possible loss of the money you invest. 

Bond funds are subject to the risk that an issuer will fail to make payments on time, and that bond prices will decline because of rising interest rates or negative perceptions of an issuer's ability to make payments. Investments in bonds are subject to interest rate, credit, and inflation risk.

Vanguard Marketing Corporation, Distributor.

SOURCE Vanguard