This combination provides broad exposure to the global investment-grade fixed-rate debt market, including government, corporate and securitized debt, all with maturities of more than one year. As of the end of June, BNDW’s underlying index held approximately 44% U.S. bonds and 56% non-U.S. bonds.

According to Vanguard, the new ETF’s direct investment in existing Vanguard bond ETFs allows the fund to achieve immediate scale and access to the global investment-grade bond market. Furthermore, the ETF of ETFs structure allows BNDW to closely track the returns of the benchmark by keeping the expense ratio and transaction costs lower for investors.

“With BNDW, Vanguard is the first firm to offer U.S. investors a single index product with exposure to the total global investment-grade bond universe,” Vanguard Chief Investment Officer Greg Davis said in a note. “It’s a simple, convenient, and low-cost way to get the diversification benefits that exposure to bonds of many countries and issuers can offer.”

For more information on new fund products, visit our new ETFs category.