Vanguard Launches a New Actively Managed Bond ETF

VALLEY FORGE, Pa., June 11, 2025 /PRNewswire/ -- Vanguard today launched Vanguard Multi-Sector Income Bond ETF (VGMS), an actively managed fixed income ETF overseen by Vanguard Fixed Income Group.

"VGMS seamlessly integrates institutional-grade active investment strategies with Vanguard's hallmark of low-cost leadership, delivering a powerful and differentiated solution for advisors and investors navigating today's complex and fast-evolving markets," said Sara Devereux, Global Head of Vanguard Fixed Income Group. "Our seasoned portfolio managers employ a rigorous top-down and bottom-up investment process, ensuring every security is meticulously evaluated and executed with precision and purpose."

The new ETF is strategically designed to add total return potential while generating higher income, offering advisors and investors access to professional management across a range of fixed income sectors including investment-grade credit, high-yield corporates, emerging market bonds, and structured products.

"Active fixed income ETFs are increasingly favored by advisors and clients for their low costs, tax efficiency, and potential to add diversification and alpha to portfolios," said Amma Boateng, managing director and head of Vanguard Financial Advisor Services. "VGMS pairs these features of an ETF with Vanguard's experienced team and proven process to seek outperformance in higher-yielding sectors of the bond market."

VGMS boasts a competitive estimated expense ratio of 0.30%¹, providing a cost advantage of 0.18% compared to the asset-weighted category average.² It represents Vanguard's seventh actively managed fixed income ETF in the U.S. and is managed by industry veterans Michael Chang, Arvind Narayanan, and Daniel Shaykevich, each of whom has more than two decades of experience managing fixed income portfolios.           

A Global Fixed Income Leader
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. With a client-centric approach, Vanguard continues to invest in its active bond portfolio management capabilities and offers a carefully curated and enduring line-up that has offered long-term value and meets investor needs. Vanguard's active fixed income portfolio managers employ a data-driven approach to fund management, focusing on identifying high information ratio strategies, optimizing trade execution, and delivering a repeatable investment process that has delivered strong investment outcomes, compounding over the long term. Vanguard's track record reflects this, with 91% of Vanguard active fixed income funds outperformed their peer group averages over the past ten years ended 3/31/2025.³

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.

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. Diversification does not ensure a profit or protect against a loss.

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.

High-yield bonds generally have medium- and lower-range credit quality ratings and are therefore subject to a higher level of credit risk than bonds with higher credit quality ratings.

Investments in bonds issued by non-U.S. companies are subject to risks including country/regional risk and currency risk. These risks are especially high in emerging markets.

Vanguard Marketing Corporation, Distributor.

SOURCE Vanguard