The Vanguard Group launched nine equity ETFs linked to S&P indexes yesterday. The new ETFs follow large, mid and small company U.S. stocks with growth, value and blend characteristics.
The Vanguard S&P 500 ETF (NYSE: VOO), which also debuted, now serves as the ETF share class for the company’s flagship Vanguard 500 Index Fund (NASDAQ: VFINX). At the end of August the latter had over $86 billion in assets.
“The new Vanguard index funds and ETFs offer our trademark low costs and tax efficiency, and aim for the utmost tracking precision. They will appeal to financial advisers and institutional investors seeking to build portfolios based on S&P benchmarks. The new ETFs will help Vanguard continue to build momentum in the ETF marketplace,” said Vanguard Chairman and CEO Bill McNabb.
Vanguard has been locked in a heated battle with competitors like BlackRock, Charles Schwab and State Street Global Advisors over ETF assets. Earlier in the year, the mutual fund giant introduced commission free trading on Vanguard ETFs for its brokerage customers. Also, VOO takes direct aim at the SPDR S&P 500 ETF (NYSE: SPY) with lower annual expenses of 0.06% compared to 0.09%.
The Vanguard S&P equity ETFs join the company’s other stock ETFs which follow MSCI constructed indexes.
In the coming months, Vanguard plans to introduce 11 additional index funds with ETF Shares. On the equity side, Vanguard plans to add a suite of seven funds with ETF Shares to offer exposure to the value, growth, and blend segments of the U.S. stock market. Six of the new funds with ETF shares will be based on the large-cap Russell 1000 Index series and the small-cap Russell 2000 Index series. A broad-market fund and ETF seeking to track the Russell 3000 Index will also be offered.
On the bond side, Vanguard will offer three new municipal bond index funds with traditional and exchange-traded shares, tracking benchmarks in the S&P National AMT-Free Municipal Bond Index series. The expense ratio for each of Vanguard’s new municipal ETFs is estimated to be 0.12%.
Vanguard has also filed for a new real estate fund, which will be benchmarked to the S&P Global Ex-U.S. Property Index. Vanguard Global ex-U.S. Real Estate Index Fund will offer Investor Shares, Institutional Shares, Signal Shares, and ETF Shares.
After the introduction of these planned products, Vanguard will offer 66 ETFs based on indexes from major benchmark providers.
Here’s a list of the Vanguard S&P equity ETFs:
- Vanguard S&P 500 (NYSE: VOO) Expense Ratio: 0.06%
- Vanguard S&P 500 Value (NYSE: VOOV) Expense Ratio: 0.15%
- Vanguard S&P 500 Growth (NYSE: VOOG) Expense Ratio: 0.15%
- Vanguard S&P MidCap 400 (NYSE: IVOO) Expense Ratio: 0.15%
- Vanguard S&P MidCap 400 Value (NYSE: IVOV) Expense Ratio: 0.20%
- Vanguard S&P MidCap 400 Growth (NYSE: IVOG) Expense Ratio: 0.20%
- Vanguard S&P SmallCap 600 (NYSE: VIOO) Expense Ratio: 0.15%
- Vanguard S&P SmallCap 600 Value (NYSE: VIOV) Expense Ratio: 0.20%
- Vanguard S&P SmallCap 600 Growth (NYSE: VIOG) Expense Ratio: 0.20%
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