Vanguard Reports Expense Reductions on Stock and Bond ETFs
Savings to Vanguard clients totals $85.1 million in fiscal year 2019
VALLEY FORGE, Pa., Feb. 20, 2020 /PRNewswire/ -- In fund annual reports published today, Vanguard reported lower expense ratios on four ETFs, including the $8.3 billion Vanguard Extended Market ETF, the $21.9 billion Vanguard Short-Term Bond ETF, the $12.6 billion Vanguard Intermediate-Term Bond ETF, and the $4.8 billion Vanguard Long-Term Bond ETF. Vanguard also reported lower expenses on three mutual fund share classes of Vanguard Extended Market Fund.
In aggregate, these changes represent $12.9 million in savings returned to investors, bringing the total 2019 fiscal year client savings to $85.1 million.1 See the accompanying table for a full list of expense ratio changes by fund.
Vanguard Mutual Fund and ETF Expense Ratio Changes
Fund Name |
2018 Fiscal Ratio |
2019 Fiscal |
Change |
Short-Term Bond ETF |
0.07% |
0.05% |
-2 |
Intermediate-Term Bond ETF |
0.07% |
0.05% |
-2 |
Long-Term Bond ETF |
0.07% |
0.05% |
-2 |
Extended Market ETF |
0.07% |
0.06% |
-1 |
Extended Market Index Fund Admiral |
0.07% |
0.06% |
-1 |
Extended Market Index Fund Institutional |
0.06% |
0.05% |
-1 |
Extended Market Index Fund Institutional Plus |
0.05% |
0.04% |
-1 |
Note: The 2018 expense ratios listed above reflect figures published in each fund's last annual report and prospectus. Updated 2019 figures will not be reflected in the funds' online profiles until each fund files its next prospectus. |
Vanguard Fixed Income ETFs
Driven in part by record fixed income ETF cash flow, Vanguard reported lower expense ratios on 16 of its 18 U.S. bond ETFs over the 2019 fiscal year reporting cycle. Vanguard's U.S. fixed income ETFs experienced $37.1 billion in cash flow in 2019, a 103% increase from $18.3 billion in 2018. Given the scale of the global bond market and relative small footprint of bond ETFs, Vanguard expects greater fixed income ETF adoption to continue.
About Vanguard
Vanguard is one of the world's largest investment management companies. As of January 31, 2020, Vanguard managed $6.2 trillion in global assets. The firm, headquartered in Valley Forge, Pennsylvania, offers 425 funds to its more than 30 million investors worldwide. For more information, visit vanguard.com.
Asset figures are as of January 31, 2020 unless otherwise noted.
1Cumulative figure for all share classes from fiscal year ending August 2019 through December 2019 for the identified funds. Estimated savings is the difference between prior and current expense ratios multiplied by average AUM. Average AUM is based on daily average assets during a month, which are then averaged over the 12-months of the fiscal year.
For more information about Vanguard funds or Vanguard ETFs, visit vanguard.com or call 800-662-7447 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.
Vanguard Marketing Corporation, Distributor of the Vanguard Funds.
SOURCE Vanguard
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