VALLEY FORGE, PA — Vanguard, the Pennsylvania-based investment management group, has expanded its tax-exempt bond exchange-traded fund (ETF) offerings. The firm recently launched the Vanguard Intermediate-Term Tax-Exempt Bond ETF (VTEI) and the Vanguard California Tax-Exempt Bond ETF (VTEC), both managed by the Vanguard Fixed Income Group.
The new offerings come as advisors and individual investors continue to favor ETFs for their tax efficiency and flexibility to trade at intraday market prices. Vanguard’s latest move serves to bolster its already impressive $242 billion municipal bond lineup, which includes a variety of active mutual funds, money market funds, and two other ETFs.
Sara Devereux, global head of Vanguard Fixed Income Group, underscored the importance of these new additions. “The continued expansion of our tax-exempt bond ETF lineup brings advisors and individual investors new ways to access the municipal market with a low-cost and diversified portfolio,” she said.
The Vanguard Intermediate-Term Tax-Exempt Bond ETF is tailored for tax-sensitive investors with an intermediate-term time horizon and a preference for passive management. The ETF boasts an expense ratio of just 0.08%, significantly lower than the average expense ratio of 0.37% for competing funds.
Similarly, the Vanguard California Tax-Exempt Bond ETF targets tax-sensitive investors living in California. Again, this ETF offers a highly competitive expense ratio of 0.08%, compared to the 0.27% average among rival funds.
These new ETFs underscore Vanguard’s commitment to providing cost-effective investment solutions. By keeping expense ratios low, Vanguard ensures that more of investors’ money is put to work in the market, potentially leading to higher net returns over time.
Both the VTEI and VTEC provide investors with a cost-effective way to gain exposure to municipal bonds while enjoying the benefits of tax-exempt income. Vanguard’s move to expand its lineup of tax-exempt bond ETFs is in line with the firm’s long-standing commitment to providing investors with a broad range of high-quality, low-cost investment options.
As the investment landscape continues to shift, Vanguard’s expanded offerings provide investors with more ways to access tax-efficient investment strategies, helping them to navigate the complexities of today’s market dynamics.
As more individuals and advisors continue to gravitate towards ETF structures, Vanguard’s latest offerings are well-positioned to meet this growing demand.
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