Vanguard Rolls Out 2 Active Bond ETFs

The Vanguard Core-Plus Bond ETF offers exposure mostly to U.S. investment-grade securities but will have flexibility to add allocations in sectors beyond the U.S. investment-grade bond market, such as U.S. high-yield corporates and emerging markets debt. It will have an expense ratio of 0.20%, compared with an average of 0.75% for competing funds, according to Vanguard. Daniel Shaykevich, Brian Quigley, Arvind Narayanan and Michael Chang will manage the ETF.

Vanguard intends to launch the Vanguard Core Bond ETF by year-end. The ETF, to be managed by Shaykevich, Quigley and Narayanan, will offer similar exposure to the Core-Plus Bond ETF but with more modest allocations to riskier sectors such as U.S. high-yield corporates and emerging market debt. It will have an estimated expense ratio of 0.10%, compared with an average of 0.58% for competing funds, according to Vanguard.

Last week, the Vanguard Total Bond Market ETF (BND) became the first bond ETF to surpass $100 billion in assets, Bloomberg reported.

Vanguard Fixed Income Group is the world’s largest bond mutual fund and ETF manager,  overseeing more than $2.1 trillion in global assets under management, the company said.