Vanguard launches five new ETFs on TSX

Jul 9th, 2014 | By | Category: Alternatives / Multi-Asset

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Vanguard has announced the launch of five new exchange-traded funds listed on the Toronto Stock Exchange.

Vanguard launches five new ETFs on TSX

Atul Tiwari, managing director of Vanguard Investments Canada.

The three equity ETFs and two bond ETFs bring to 21 the number of Canada-domiciled ETFs offered by the firm.

Four of the funds offer first-of-a-kind market exposures among Canada-listed ETFs.

The new funds are:

Vanguard FTSE All-World ex Canada Index ETF (VXC)

Vanguard FTSE Developed Europe Index ETF (VE)

Vanguard FTSE Developed Asia Pacific Index ETF (VA)

Vanguard US Aggregate Bond Index ETF (CAD-hedged) (VBU)

Vanguard Global ex-US Aggregate Bond Index ETF (CAD-hedged) (VBG)

The Vanguard FTSE All-World ex Canada Index ETF is the first to track the performance of a broad global equity index that focuses on developed and emerging markets, excluding Canada; the Vanguard FTSE Developed Asia Pacific Index ETF is the first to track the performance of a broad Asia Pacific equity index that focuses on developed Asia Pacific markets; while the Vanguard US Aggregate Bond Index ETF (CAD-hedged) and Vanguard Global ex-US Aggregate Bond Index ETF (CAD-hedged) are the first to offer exposure to US and international government bonds with currency hedging, in addition to other fixed-income securities.

Commenting on the launch, Atul Tiwari, managing director of Vanguard Investments Canada, said: “Our new broad market global and international index ETFs will better enable individual investors, financial advisors and institutions to obtain broader diversification and lower risk to their overall portfolios. Our research shows that investors display a persistent and significant home bias, and Canadian investors should consider allocating assets to international securities.”

Research demonstrates that investors, regardless of country of residence, favour domestic holdings at the expense of foreign securities. This home bias often conflicts with the principles of broad global diversification.

Prior to these new listings, Vanguard offered 16 ETFs in Canada with total assets of more than $2.5 billion. The weighted-average management expense ratio (MER)—which includes the management fee—for those ETFs was 0.22% as of December 31, 2013. The ETF industry average was 0.41%.

The simple-average management fee for Vanguard’s expanded line-up of 21 ETFs is expected to be 0.22%.

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