(EFT Trends) - The price war continues in the battle to see who can offer the lowest-priced exchange traded fund (ETF) products with Vanguard slashing fees on 17 funds.
A number of Vanguard’s fixed income ETF product suite received a one basis-point discount — many of which were already low to begin with, such as the the Vanguard Total Corporate Bond ETF ETF Shares (VTC). VTC’s expense ratio is now just 0.04%, which should give fixed income investors something to cheer about if they’re looking for corporate debt exposure.
Given the popularity of environmental, social, and governance (ESG) investing, it might seem that fees would go higher. Vanguard actually cut the expense ratio on the Vanguard ESG U.S. Stock ETF (ESGV) by three basis points to 0.09%.
Vanguard also shaved off some basis points from a number of mutual funds as well. A year-end cutting of fees heading into 2022 could hopefully bring investors off the cash sidelines and into more ETFs.
“Flows are showing money pouring out of mutual funds and into ETFs and they are being aggressive to do everything to stem outflows and attract new capital,” Bloomberg Intelligence analyst James Seyffart said. “Other legacy managers with no strategy for the ETF ecosystem and who aren’t cutting fees are basically sticking their head in the sand, as far as I’m concerned.”
