InvestmentsMay 30 2013

Launch Pad: ETFs

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ByFiona Nicolson

The launch follows the introduction of five large ETFs for the European market by the US fund manager last year.

The four new funds are the Vanguard FTSE Developed Europe Ucits ETF, the Vanguard FTSE Developed Asia Pacific ex Japan Ucits ETF, the Vanguard FTSE Japan Ucits ETF and the Vanguard FTSE All-World High Dividend Yield Ucits ETF.

Key points:

The goal is to provide low-cost, physically-backed ETFs.

The previous five ETFs were the Vanguard FTSE 100, Vanguard S&P 500, Vanguard FTSE Emerging Markets, Vanguard FTSE All-World and Vanguard UK Government Bond.

The range now provides UK and European investors with access to key developed equity markets.

The Vanguard Group uses FTSE benchmarks for 21 index portfolios around the world, representing $8.7bn (£5.8bn) in assets

Vanguard has gained nearly $437bn (£290bn) of assets in the US since its first ETF launch in 2001.

Vanguard launched the education site last year to provide advisers with information on ETF products. The site has attracted more than 570 adviser registrations and 4000 downloads.

IFA verdict

James Norton, financial planner for London-based Evolve Financial Planning, said: “This is an excellent move by Vanguard by bringing more common-sense, low-cost ETFs to the market. It broadens its range considerably and I would be happy to recommend these. It shows strikingly how expensive other ETF providers are. The cost difference is huge. Hopefully money will talk and people will invest in these lower-cost funds.”