Vanguard has launched its first active exchange traded funds (ETF) on the London Stock Exchange.
The four ETFs will be managed by Vanguard’s quantitative equity group and will have an ongoing charge of 0.22%.
- Vanguard Global Value Factor Ucits ETF targets low-valued stocks
- Vanguard Global Momentum Factor Ucits ETF focuses on stocks with strong recent share price performance over the last year
- Vanguard Global Liquidity Factor Ucits ETF invests in stocks that are less regularly traded
- Vanguard Global Minimum Volatility Ucits ETF aims to help reduce risk and invests in stocks with lower volatility
Axel Lomholt, head of product at Vanguard’s International business, said he believes the new ETFs offer an alternative to more high cost active strategies that target similar exposures.
‘Vanguard has chosen to take an active approach to managing these funds by using quantitative models to select stocks and build a portfolio that targets the desired factor whereas other managers may track an index to implement a factor-based strategy,' he said. 'Investors need to be confident that the methodology chosen will deliver their desired factor exposure to meet long-term investment objectives.’
This launch brings Vanguard’s ETF offering in the UK up to 17 funds and the assets under management within those to over £12.5 billion with an average expense ratio of 0.17%.
John James (pictured), managing director, Vanguard Europe, added: ‘Today’s launch reinforces Vanguard’s commitment to offering UK investors high-value, low-cost active and index funds. Vanguard has successfully managed active funds in the US for more than forty years and we have nearly US$1 trillion in active assets under management.’