Lock in Some High Yields for Longer With VCLT

With money market funds yielding 5%, many advisors have been leaning on short-term money market funds. And while that 5% is great, what happens if and when that yield goes away? It may be worth locking in some higher yields for longer. That’s where the Vanguard Long-Term Corporate Bond ETF (VCLT) can come into play.

See more: “Consider This Tax-Efficient Way to Increase Your Fixed Income Allocation

Per Vanguard, VCLT seeks to provide a high and sustainable level of current income by investing in high-quality corporate bonds. It maintains a dollar-weighted average maturity of 10 to 25 years.

The fund had a 30-day SEC yield of 5.87% as of Sept. 20. VCLT carries an expense ratio of 4 basis points.

Low-Cost, Scalable Advice

Vanguard’s CEO Tim Buckley said at Exchange 2023 that the firm’s goal is “to make sure we’re producing the top-performing funds and ETFs out there.”

“We’ll wrap it with low-cost, scalable advice and deliver them on a world-class, digitally enabled platform,” he added. “And if you do that well and you can keep improving it, you’ll create value into the future.”

VettaFi’s vice chairman Tom Lydon called Vanguard “the Hoover of the ETF industry” for the way in which it’s vacuumed up investor dollars.

“They are just rock solid,” he said. “They have so many choices. They’re low-cost and always very, very dependable.”

For more news, information, and analysis, please visit the Fixed Income Channel.