VALLEY FORGE, Pa.--(BUSINESS WIRE)--Vanguard today launched Vanguard Total International Bond Index Fund, which offers three low-cost conventional shares (Investor, Admiral™, and Institutional) that are available for purchase immediately. The fund’s ETF shares (ticker: BNDX) are expected to begin trading on June 4, 2013.
The new fund provides broad exposure to the international fixed income markets and serves as a complement to the firm’s other total market offerings: the $248 billion Total Stock Market Index Fund, the $117 billion Total Bond Market Index Fund, the $95 billion Total International Stock Index Fund, and the $3 billion Total World Stock Index Fund.
“Our broad market index funds enable individual investors, financial advisors, and institutions to build broadly diversified, balanced investment portfolios at an extremely low cost,” said Vanguard CEO Bill McNabb. “We’ve seen a growing number of investors adopt low-cost, diversified investment programs through our all-in-one funds or assemble their own balanced portfolios using our broad-based funds and ETFs.”
The Total International Bond Index Fund will seek to track the performance of the Barclays Global Aggregate ex-USD Float Adjusted RIC Capped Index (USD Hedged). The index comprises approximately 7,000 investment-grade corporate and government bonds from 52 countries. The index caps its exposure to any single bond issuer, including government issuers, at 20% to meet regulated investment company (RIC) tax diversification requirements. The top country holdings as of April 30, 2013 were Japan (22%), France (11%), Germany (11%), Italy (8%), and the United Kingdom (8%).
The expense ratios for the fund’s Investor, Admiral, Institutional, and ETF share classes will range from 0.12% to 0.23%, as shown in the table below.
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Four Share Classes Featuring Low Expense Ratios |
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| Total International Bond Index Fund | Minimum Initial Investment | Estimated Expense Ratio | ||
| Investor Shares | $3,000 | 0.23% | ||
| Admiral Shares | $10,000 | 0.20% | ||
| Institutional Shares | $5,000,000 | 0.12% | ||
| ETF Shares (BNDX) | -- | 0.20% | ||
Vanguard also announced today:
- The subscription period for Vanguard Emerging Markets Government Bond Index Fund has concluded. Low-cost conventional shares of the fund (Investor, Admiral, and Institutional) are available for purchase. The fund’s ETF shares (ticker: VWOB) are expected to begin trading on June 4, 2013.
- Vanguard Total International Bond Index Fund has been added to 18 of Vanguard’s all-in-one funds (including Vanguard Target Retirement Funds) and represents 20% of the fixed income allocation of the funds. In addition, Vanguard Short-Term Inflation-Protected Securities Index Fund has replaced Vanguard Inflation-Protected Securities Fund in three Target Retirement Funds (Target Retirement Income, 2010, and 2015).
- The 0.25% purchase fee for the Short-Term Inflation-Protected Securities Index Fund has been eliminated.
About Vanguard
Vanguard, headquartered in Valley Forge, Pennsylvania, is one of the world’s largest investment management companies and a leading provider of company-sponsored retirement plan services. Vanguard manages $2.2 trillion in U.S. mutual fund assets, including more than $285 billion in ETF assets. The firm offers more than 160 funds to U.S. investors and more than 80 additional funds in non-U.S. markets. For more information, visit vanguard.com.
All asset figures are as of April 30, 2013.
For more information about Vanguard funds, visit vanguard.com or call 800-662-7447 to obtain a prospectus. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing.
All investments are subject to risk, including the possible loss of the money you invest. Bond funds are subject to interest rate risk, which is the chance bond prices overall will decline because of rising interest rates, and credit risk, which is the chance a bond issuer will fail to pay interest and principal in a timely manner or that negative perceptions of the issuer’s ability to make such payments will cause the price of that bond to decline. Diversification does not ensure a profit or protect against a loss.
Investments in Vanguard Total International Bond Index Fund are subject to risks including country/regional risk and currency risk. Vanguard Total International Bond Index Fund is subject to currency hedging risk, which is the chance that currency hedging transactions may not perfectly offset the fund's foreign currency exposures and may eliminate any chance for a fund to benefit from favorable fluctuations in those currencies. The Fund will incur expenses to hedge its currency exposures.
The Emerging Markets Government Bond Index Fund is 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. The Fund seeks to track the performance of an index that measures the investment return of dollar-denominated bonds issued by governments of emerging market countries (including government agencies and government-owned corporations). It is subject to risks including country/regional risk, which is the chance that political upheaval, financial troubles, or natural disasters will adversely affect the value of securities issued by foreign governments, and emerging market risk, which is the chance that bonds of governments located in emerging markets will be substantially more volatile and substantially less liquid that the bonds of governments located in more developed foreign markets.
Investments in stocks issued by non-U.S. companies are subject to risks including country/regional risk and currency risk.
Vanguard ETF Shares are not redeemable with the issuing Fund other than in Creation Unit aggregations. Instead, investors must buy or sell Vanguard ETF Shares in the secondary market with the assistance of a stockbroker. 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.
Investments in Target Retirement Funds are subject to the risks of their underlying funds. The year in the Fund name refers to the approximate year (the target date) when an investor in the Fund would retire and leave the work force. The Fund will gradually shift its emphasis from more aggressive investments to more conservative ones based on its target date. An investment in the Target Retirement Fund is not guaranteed at any time, including on or after the target date.
The Vanguard ETFs are not sponsored, endorsed, sold or promoted by Barclays. Barclays does not make any representation regarding the advisability of investing in Vanguard ETFs or the advisability of investing in securities generally. Barclays' only relationship with Vanguard is the licensing of the Index which is determined, composed and calculated by Barclays without regard to Vanguard or the Vanguard ETFs. Barclays has no obligation to take the needs of Vanguard or the owners of the Vanguard ETFs into consideration in determining, composing or calculating the Index. Barclays has no obligation or liability in connection with administration, marketing or trading of the Vanguard ETFs.
U.S. Pat. No. 6,879,964 B2; 7,337,138; 7,720,749; 7,925,573; 8,090,646
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© 2013 The Vanguard Group, Inc. All rights reserved.
