Vanguard Debuts Ultra-Short Bond ETF
A press release entitled, "Vanguard Launches Ultra-Short Bond ETF," tells us, "Vanguard today introduced its first actively managed bond ETF, managed by its in-house fixed income team. Vanguard Ultra-Short Bond ETF (VUSB) offers a low-cost, diversified option for investors seeking income and limited price volatility. The ETF, which is listed on the Chicago Board Options Exchange (Cboe), has an expense ratio of 0.10%, compared with the average expense ratio for ultra-short-term bond ETFs of 0.22%." Kaitlyn Caughlin, Head of Vanguard Portfolio Review Department, comments, "Vanguard Ultra-Short Bond ETF offers the features of an ETF structure for investors seeking an option for anticipated cash needs in the range of 6 to 18 months.... An ultra-short strategy bridges the gap between money market funds offering a stable share price and short-term bond funds, which are meant for longer investment time horizons." The release continues, "Vanguard Ultra-Short Bond ETF offers a similar strategy to that of the $17.5 billion actively managed Vanguard Ultra-Short-Term Bond Fund, which debuted in 2015. Both the fund and the new ETF invest in diversified portfolios consisting of high-quality and, to a lesser extent, medium-quality fixed income securities, including investment-grade credit and government bonds. The ETF provides investors and advisors the flexibility to trade at intraday market prices and invest by buying one share. Vanguard adds, "Like the existing Ultra-Short-Term Bond Fund, the new ETF is co-managed by Samuel C. Martinez, CFA, Arvind Narayanan, CFA, and Daniel Shaykevich."
