Vanguard has gone from being known as being the low-price leader in the exchange traded fund (ETF) industry to being known as something else: one of the fastest-growing ETF providers around.
Vanguard has always been a respectably-sized provider, thanks to its cohesive line of low-cost ETFs. But since March 2009, Vanguard’s assets under management have more than doubled from $43.3 billion to $103.7 billion – a 139% gain. It’s now the third-largest ETF provider.
But that isn’t all that’s happening with the provider:
- Vanguard’s emerging markets fund, Vanguard MSCI Emerging Market (NYSEArca: VWO), is even gaining serious ground on its direct competitor, the iShares MSCI Emerging Markets (NYSEArca: EEM). They’re now the fifth and fourth-largest ETFs in the industry, respectively. VWO is behind EEM by $12.2 billion, but considering that just one year ago last March VWO had $5.3 billion in assets, it’s not too outlandish to think that it may eventually surpass EEM.
- The provider got 48% of positive cash flow to ETFs industry-wide in the first quarter, and also led the industry in cash flows for the first quarter.
- The cash flow has stayed steady, with at least $1 billion in cash flow for each month over the last year.
- Volume has increased in Vanguard ETFs in dollar terms, and saw a 25% increase in volume in the first quarter from a year ago.
Martha Papariello, the head of Vanguard’s ETF business, says that naturally the provider is excited about what’s been happening in recent months. “We’re winning one firm and one financial advisor at a time. It’s an exciting story.”
Papariello credit’s Vanguard’s increasing popularity with the fact that they’re known for their indexing expertise, better tracking and lower expense ratios. Vanguard’s retired founder and CEO John Bogle invented the concept of index-tracking funds when he launched the Vanguard 500 Index Fund in 1975.