Vanguard, the second-largest U.S. issuer of exchange traded funds, continues cementing its status as a low-cost leader in the ETF industry with Tuesday’s announcement of lower expenses on 21 ETFs.
The group of Vanguard ETFs with new, lower fees includes the issuer’s lineup of 10 sector funds. That means Vanguard’s sector ETFs are now the least expensive on the market. Prior to yesterday’s announcement, Vanguard’s sector ETFs were tied with Fidelity’s as least expensive with annual fees of 0.12%, or $12 per $10,000 invested.
Vanguard’s sector ETFs now charge 0.1% per year with the exception of the Vanguard Health Care ETF (NYSEArca: VHT), which now carries an annual fee of just 0.09%. Other popular Vanguard sector ETFs include the Vanguard Energy ETF (NYSEArca: VDE) and the Vanguard Materials ETF (NYSEArca: VAW).
“Vanguard continues to set the standard as the industry’s low-cost leader, reducing costs not just on a subset of products, but across our funds and ETFs,” said Vanguard CEO Bill McNabb in a statement. “We have a track record of nearly 40 years of lowering the cost of investing for our clients and we have every intention of continuing to lower the cost of investing.”
Pennsylvania-based Vanguard also said it is lowering expenses on eight of its fixed income ETFs, including the Vanguard Intermediate-term Bond ETF (NYSEArca: BIV). BIV “seeks to track the investment return of the Barclays U.S. 5–10 Year Government/Credit Float Adjusted Index, a market-weighted bond index that covers investment-grade bonds with a dollar-weighted average maturity of 5 to 10 years,” according to Vanguard.
Those eight Vanguard bond ETFs saw expenses drop to 0.1% per year from 0.12%.
The issuer also reduced expenses on all three of its mega-cap ETFs, including the popular Vanguard Mega Cap ETF (NYSEArca: MGC).
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