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Vanguard Launches Broad Global ETF
June 27, 2008
SAN DIEGO - (ETFguide.com) - Vanguard rarely comes out with new ETFs, but when they do they make it count. More than three decades ago, Vanguard introduced the first retail index mutual fund and now manages portfolios with aggregate assets of more than $575 billion.
On Thursday, Vanguard launched the Vanguard Total World Stock Index ETF (Ticker: VT) which is based on the FTSE All-World Index. The Index is a free-float- adjusted, market-capitalization-weighted index designed to measure the market performance of large- and mid-capitalization stocks of companies located around the world and includes approximately 2,900 stocks of companies located in 47 countries, including both developed and emerging markets.
As of
March 31, 2008, the largest markets covered in the Index were the
United States, the
United Kingdom,
Japan,
France, and
Germany, which made up approximately 41%, 9%, 9%, 5%, and 4%.
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“We view the new offering as an ideal foundation fund for a well-diversified investment portfolio”, said Gus Sauter, Vanguard’ chief investment officer.
Because of Vanguard’s unique ETF structure, their ETFs tend to be broader than most. Two other foundational funds include the Vanguard Total Stock Market ETF (Ticker: VTI) and the Vanguard FTSE All World ex-US ETF (Ticker: VEU).
The new Vanguard Total World Stock ETF goes up directly against the iShares MSCI ACWI Index Fund (Ticker: ACWI) which only holds 700 securities and charges 0.35% vs. Vanguard’s 0.25%.
Northern Trust is expected to launch their NETS Dow Jones Wilshire Global Total Market Index Fund. The underlying covers more than 50 countries and more than 10,000 securities index (the actual ETF will probably use a sample strategy).
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