Over the past several years Barclays Global Investors (BGI) has been the lone provider of U.S.-listed bond ETFs, but now they’ve got company.
In April, the Vanguard Group launched four ETFs that track Lehman Brothers bond indices. The products are managed by Vanguard’s fixed-income group, which manages $310 billion in assets, including $65 billion in bond index funds.
The new ETFs all have expense ratios of 0.11 percent, which is roughly half the median expense ratio of all bond ETFs in ETFguide.com’s database, and will compete head-to-head with similar products offered by BGI.
o Vanguard Total Bond Market ETF (Amex: BND)
o Vanguard Short-Term Bond ETF (Amex: BSV)
o Vanguard Intermediate-Term Bond ETF (Amex: BIV)
o Vanguard Long-Term Bond ETF (Amex: BLV)
“We are pleased to expand our ETF offerings to bonds, bringing additional choice to investors and cost competition to the ETF marketplace,” says Vanguard Chief Investment Officer Gus Sauter, noting that Vanguard’s ETF assets more than doubled over the past year to $27 billion. “Vanguard ETFs are gaining broader appeal among investors because of their low costs, broad diversification and precise tracking.”