Vanguard has launched three new ETFs focused on U.S. government bonds.
Vanguard Fixed Income Group manages all three exchange-traded funds: the actively managed Vanguard Government Securities Active ETF (VGVT), and Vanguard Total Treasury ETF (VTG) and Vanguard Total Inflation-Protected Securities ETF (VTP), which are both indexed.
“The actively managed VGVT leverages our fixed income expertise to deliver a flexible, high-quality portfolio of U.S. government and agency bonds, along with select securitized credit,” Vanguard Fixed Income Group’s Global Head of Rates, Roger Hallam, said in a news release.
VGVT is designed as a core bond holding that adapts to changing market conditions while maintaining the diversification and risk-buffering qualities of Treasuries, Hallam said. The ETF can balance equity exposure and offers long-term portfolio stability through active management, he said.
VGVT is built to outperform the broad Treasury market while maintaining the diversification benefits of Treasuries, according to the release. As Vanguard’s eighth active bond, VGVT has a 0.10 expense ratio.
VTG offers broad exposure to the U.S. Treasury market, which Vanguard noted is the largest and most liquid fixed income sector, and has an 0.03% expense ratio.
Vanguard touted VTP as a “robust tool” designed to protect the portfolios of long-term investors from inflation risk. It provides exposure to the U.S. TIPS market and complements the Vanguard Short-Term Inflation Protected ETF (VTIP). VTP has an expense ratio of 0.05%..
Both VGT and VTP are managed by Vanguard’s bond index fixed income team.
With the three new additions, Vanguard offers 36 fixed income bond ETFs, 28 of which are index.
