For a passive provider Vanguard is getting very active.
The Valley Forge, Pennsylvania shop has always in fact had a healthy number of active funds and assets, a cool $1.24 trillion to be exact, but in recent months it has been boosting this line-up.
In July it set out plans for two global versions of long-standing active funds. Last week it unveiled six active exchange-traded funds (ETFs). And this week it announced that it is to launch an active hard currency emerging markets bond fund.
The Vanguard Emerging Markets Bond fund will be benchmarked against the JP Morgan EMBI Global Diversified index, with the majority of its assets either denominated in or hedged back to the US dollar.
It will be allowed to invest in off-benchmark emerging market sectors, such as emerging market corporate bonds and local currency bonds on a limited basis.
Subadvised by Vanguard’s in-house fixed income group, the fund is managed by Daniel Shaykevich, who joined the firm in 2013 and has worked in the investment management industry since 2001.
Vanguard said that the fund would be one of the lowest-cost actively managed funds in its category, as defined by Morningstar, with the fund’s Investor and Admiral shares charging expense ratios of 0.60% and 0.45%, respectively.
‘Emerging market debt is a well-established asset class offering credit exposure and diversification that is complementary to corporate and high yield bonds,’ said John Hollyer, global head of Vanguard fixed income group. ‘The fund provides investors with low-cost, broad exposure to emerging fixed income markets.’
Vanguard managed $4.8 trillion in total assets as of October 31.