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ETFs, Investments

Two new ETFs from Vanguard

Australians can expand their investment portfolio with two new diversified Exchange Traded funds [ETF] launched by global fund manager Vanguard.

Vanguard has introduced two new ETFs to the ASX catering separately for growth-minded and income-focused investors.

Vanguard has added to its exchange-traded fund (ETF) line-up with the release of two new offerings on the Australian Securities Exchange (ASX) today, with one focused on capital growth and the other on income.

The Vanguard Diversified All Growth Index ETF, trading under ASX ticker VDAL, is an equities-based product with a 100 per cent allocation to growth assets. Its investment universe consists of 6000 equities listed across over 50 global markets, including Australia and emerging economies.

It is aimed at investors seeking long-term capital growth with a very high risk appetite.

Conversely, the Vanguard Diversified Income ETF, trading under ASX ticker VDIF, is aimed at individuals looking for a regular source of revenue while still enjoying some capital growth. It uses underlying funds that invest in investment-grade fixed income and corporate bond strategies, and high dividend-yield equities, which in turn gives investors exposure to more than 12,000 stocks.

Its portfolio weighting consists of a 60 per cent allocation to growth equities and 40 per cent allocation to defensive shares.

“Like our existing ready-made diversified fund options, our new all-growth and income-focused ETFs are designed with the diverse needs of Australian investors in mind. For example, a younger investor in an accumulation stage and focused on building their wealth or a retiree looking for a higher level of income,” Vanguard head of multi-asset solutions Matthew Cho explained.

“Our diversified ETFs are grounded in our proven investment philosophy, which emphasises low costs and broad diversification. We bring this philosophy to life through strategic asset allocation – that is, we carefully design the weights of the various asset classes to be robust in various market conditions. Our professional portfolio managers then regularly rebalance the ETFs to ensure they stay aligned with their stated risk profiles and investment objectives.”

VDAL and VDIF charge annual fees of 27 basis points and 32 basis points respectively.

Both ETFs are currently available on the Vanguard Personal Investor platform and will later be in included on third-party platforms.

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