Vanguard broadens access for index funds

November 19, 2018

 

Vanguard announced today that it is broadening access to lower-cost Admiral™ Shares of its index funds for additional individual, advisor, and institutional clients. A filing was made with the Securities and Exchange Commission to:

  • Launch Admiral share classes for the following five funds in January 2019:
    • Vanguard FTSE Social Index Fund
    • Vanguard FTSE All-World ex-US Small Cap Index Fund
    • Vanguard High Dividend Yield Index Fund
    • Vanguard Long-Term Bond Index Fund
    • Vanguard Total World Stock Index Fund
  • Lower the Admiral share class minimum investment from $10,000 to $3,000 on the 38 index products listed here for retail investors and those accessing these products through fund supermarkets. This reduced minimum investment also applies to the five funds adding the Admiral share class.

"No other firm in the industry has demonstrated Vanguard's track record of delivering cost savings and value to its clients," said Vanguard CEO Tim Buckley. "Our unique, client-owned structure1 enables us to consistently pass along economies of scale and lower the cost of investing for our clients, so they keep more of their returns."

Financial advisors will continue to have no investment minimums on any Admiral share class of these funds. Clients currently invested in the Investor share class of these funds can immediately convert to Admiral Shares. The Investor share class will be eliminated except for investment by certain Vanguard funds of funds and certain institutional retirement plan clients receiving recordkeeping services from Vanguard. Automatic conversions of eligible clients will start mid-year 2019.

Vanguard continuously explores ways to return value to shareholders. Over the last three years alone, more than 500 Vanguard mutual fund and ETF Shares reported expense ratio decreases for an estimated $625 million in cumulative savings (based on total assets).2

We strive to make it easier to work with us by simplifying our share-class structure and by lowering the cost of investing, particularly a fund's expense ratio. We will keep you apprised of any expense ratio changes as they are announced. It is this client-first business philosophy that has allowed Vanguard to stand apart from our competitors.

1Vanguard is client-owned. As client owners, individual shareholders own the funds that own Vanguard.
2Cumulative figure for all share classes from the 2015-16 fiscal year through the 2017-18 fiscal year for the U.S.-domiciled funds. Estimated savings is the difference between prior and current expense ratios multiplied by average assets under management. Average AUM is based on daily average assets during a month, which are then averaged over the 12 months of the fiscal year.

Notes:

  • All investing is subject to risk, including the possible loss of the money you invest.
 

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