Vanguard trims fees across 21 ETFs; giants VTI and VOO included

Apr 30th, 2019 | By | Category: ETF and Index News

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Vanguard has trimmed the fees charged on 21 of its US-listed ETFs including some of its biggest blockbuster products.

Vanguard trims fees across 21 ETFs

Vanguard has reduced the fees charged by some of its largest ETFs.

Eight of the ETFs adopting lower expense ratios are ranked in the firm’s top ten by assets under management.

These include the firm’s largest funds – the $114 billion Vanguard Total Stock Market ETF (VTI US) and $113bn Vanguard S&P 500 ETF (VOO US) – which now cost 0.03%, down from 0.04%. VTI and VOO are the third and fourth largest ETFs globally.

VTI provides access to the large, mid, and small-cap segments of the US equity market by tracking the CRSP US Total Market Index. The price cut puts the ETF on par with rivals such as the Schwab US Broad Market ETF (BBUS US), iShares Core S&P Total US Stock Market ETF (ITOT US), and the SPDR Portfolio Total Stock Market ETF (SPTM US), although the JPMorgan BetaBuilders US Equity ETF (BBUS US) is still the cheapest in this space with an expense ratio of just 0.02%.

VOO becomes the cheapest ETF in the US to track the bellwether S&P 500 Index, although the Schwab US Large-Cap ETF (SCHX US) and SPDR Portfolio Large Cap ETF (SPLG US), which also target the US large-cap market, come with the same expense ratio of 0.03%.

Vanguard now offers the joint-cheapest US mid-cap ETF after lowering the expense ratio of the $26bn Vanguard Mid-Cap ETF (VO US) from 0.05% to 0.04%. Sharing the space is the Schwab US Mid-Cap ETF (SCHM US).

Investors may also now benefit from cheaper access to broad developed market and emerging market exposures following reductions in the expense ratios of the $72bn Vanguard FTSE Developed Markets ETF (VEA US), from 0.07% to 0.05%, and the $65bn Vanguard FTSE Emerging Markets ETF (VWO US), from 0.14% to 0.12%.

Vanguard also made its factor ETFs more compelling by trimming the expense ratios of the $48bn Vanguard Value ETF (VTV US) and the $40bn Vanguard Growth ETF (VUG US) from 0.05% to 0.04%, while the $24bn Vanguard High Dividend Yield ETF (VYM US) dropped two basis points from 0.08% to 0.06%.

Vanguard also made several adjustments to its fixed income suite. Most notably, the $38bn Vanguard Total Bond Market ETF (BND US) had its expense ratio lowered from 0.05% to 0.04%, becoming the cheapest fixed income ETF available globally. The fund tracks the Bloomberg Barclays US Aggregate Float Adjusted Index, representing a wide spectrum of investment-grade, taxable, fixed income securities in the US including government, corporate, and international dollar-denominated bonds, as well as mortgage-backed and asset-backed securities.

The list of Vanguard ETFs, along with their old and new expense ratios, is outlined below:

Vanguard Total Bond Market ETF (BND US); 0.05%; 0.04%
Vanguard Total International Bond ETF (BNDX US); 0.11%; 0.09%
Vanguard FTSE Developed Markets ETF (VEA US); 0.07%; 0.05%
Vanguard FTSE All-World ex-US ETF (VEU US); 0.11%; 0.09%
Vanguard FTSE Europe ETF (VGK US); 0.10%; 0.09%
Vanguard Global ex-US Real Estate ETF (VNQI US); 0.14%; 0.12%
Vanguard Mid-Cap ETF (VO US); 0.05%; 0.04%
Vanguard S&P 500 ETF (VOO US); 0.04%; 0.03%
Vanguard FTSE Pacific ETF (VPL US); 0.10%; 0.09%
Vanguard FTSE All-World ex-US Small-Cap ETF (VSS US); 0.13%; 0.12%
Vanguard Total World Stock ETF (VT US); 0.10%; 0.09%
Vanguard Tax-Exempt Bond ETF (VTEB US); 0.09%; 0.08%
Vanguard Total Stock Market ETF (VTI US); 0.04%; 0.03%
Vanguard Value ETF (VTV US); 0.05%; 0.04%
Vanguard Growth ETF (VUG US); 0.05%; 0.04%
Vanguard Large-Cap ETF (VV US); 0.05%; 0.04%
Vanguard FTSE Emerging Markets ETF (VWO US); 0.14%; 0.12%
Vanguard Emerging Markets Government Bond ETF (VWOB US); 0.32%; 0.30%
Vanguard Extended Market ETF (VXF US); 0.08%; 0.07%
Vanguard Total International Stock ETF (VXUS US); 0.11%; 0.09%
Vanguard High Dividend Yield ETF (VYM US); 0.08%; 0.06%

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