Vanguard reports strong global etf growth; continues to broaden ETF lineups and lower expenses

Vanguard | 29 July 2013


Vanguard today reported that its exchange-traded funds (ETFs) continue to gain widespread investor acceptance in Australia, the United States and in other markets around the world. The third largest global provider of ETFs has also expanded its suite of products in the U.S., Australia, Canada, and the United Kingdom, and introduced its first ETF in Hong Kong.

Jim Norris, managing director for Vanguard International said "Investors worldwide have become more focused on broad diversification, low investment costs and transparency - the key characteristics of index funds and ETFs. It is gratifying to see investors embracing the Vanguard way of investing as we seek to best position them for long-term financial success".

Highlights for the first six months of 2013 include:

Four years after launching its first ETFs for trading on the Australian Securities Exchange (ASX), Vanguard Australia reached AUD 1 billion in ETF assets under management in June 2013. Vanguard Australia now offers a suite of nine funds across Australian and International Shares, Property and Fixed Income with its Vanguard's Australian Shares Index ETF the third largest ETF listed on the ASX.

Recent expense reductions include the Vanguard® All-World ex-US Shares Index ETF, trading under the ASX code VEU, with management expense falling from 0.18 per cent to 0.15 per cent.

United States
Cash flow continues to be strong in Vanguard's lineup of 67 U.S- based ETFs, with investors entrusting an ETF industry-leading USD 26 billion to the firm year-to-date through 30 June 2013 (source: Bloomberg).

Vanguard has recently broadened its product line in the United States by introducing three low-cost fixed-income ETFs: Vanguard Total International Bond ETF (ticker: BNDX), Vanguard Emerging Markets Government Bond ETF (ticker: VWOB), and Vanguard Short-Term Inflation-Protected Securities ETF (ticker: VTIP).

In addition, Vanguard reported lower expense ratios on 56 ETFs over the past year.

Vanguard Investments Canada had nearly USD 1 billion (CAD 1 billion) in ETF assets under management in June. Vanguard entered the Canadian marketplace in December 2011, listing six ETFs on the Toronto Stock Exchange. It added five more ETFs in November 2012.

Vanguard Asset Management had USD 1.4 billion (EUR 1.09 billion) in ETF assets under management as of the end of June. The company launched four new physically backed, Irish-domiciled ETFs in May 2013 on the London Stock Exchange, complementing the five Irish-domiciled ETFs that it brought to the European market in 2012. Vanguard has also cross-listed seven of the ETFs on the NYSE Euronext Exchange in Amsterdam and Paris, and on the SIX Swiss Exchange in Switzerland.

Hong Kong
Vanguard Investments Hong Kong introduced its first ETF in May 2013 on the Hong Kong Stock Exchange. In Asia, Vanguard provides institutions and intermediaries with access to its global management capabilities through ETFs, separately managed accounts and mutual funds. The Hong Kong office serves as the Asian hub for the company, which established a site in Japan in 2000 and in Singapore in 2003.

Managing Director of Vanguard Australia, John James said
"Since we launched ETFs in Australia in 2009, we have seen the global appetite for these funds take hold in this market and we look forward to continuing to expand our range of ETF offerings for Australian investors.

"In reaching this AUD 1 billion milestone, we have remained committed to educating the market on the benefits ETFs present as core building blocks of low cost diversified portfolios and have seen our continued growth supported by retail investors, professional money managers and financial advisers alike".