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March 01, 2013 at 09:30 AM
New products and actions introduced over the last week include a new emerging-markets bond fund from PIMCO, a Q2-planned emerging-markets government bond index fund and ETF shares from Vanguard, and the announcement from Vanguard that it has closed two of its funds to new advisor and institutional accounts.
In addition, First Trust launched a new actively managed ETF, and ETF Global announced a new series of ETF indices.
Here are the latest developments of interest to advisors:
1) PIMCO Launches Emerging Markets Full Spectrum Bond Fund
PIMCO has launched the PIMCO Emerging Markets Full Spectrum Bond Fund (I shares, PFSIX; A shares, PFSSX; D shares, PFSYX; C shares, PFSCX), designed to give investors a one-stop fixed-income strategy to capture the wide variety of investment opportunities in the developing world.
The fund provides an asset allocation and risk management framework for relative value investing across fixed-income and currency asset classes. It is managed by Michael Gomez, managing director and co-head of the global emerging markets portfolio management team.
2) Vanguard Adds Emerging Markets Government Bond Index Fund and ETF
Vanguard announced Thursday that it plans to introduce the Vanguard Emerging Markets Government Bond Index Fund (VGOVX) and its ETF shares by the end of Q2 2013.
VGOVX’s target benchmark is the Barclays USD Emerging Markets Government RIC Capped Index. The index features approximately 540 government, agency and local authority bonds from 155 issuers and, when necessary, limits weightings of individual debt issuers to meet IRS diversification requirements. The fund will invest solely in U.S. dollar-denominated emerging market bonds to protect U.S.-based investors from currency risk.
The expense ratios for the ETF, Investor, Admiral and Institutional shares will range from 0.30%–0.50%. The industry’s average emerging markets bond fund features an expense ratio of 1.21%.
The fund will assess a purchase fee of 0.75% on all non-ETF shares to help offset the higher transaction costs associated with buying emerging markets bonds.
3) Vanguard to Limit Growth of Two Funds
Vanguard is moving to curtail cash flow into two funds: the Vanguard Wellington Fund (VWELX) and the Vanguard Intermediate-Term Tax-Exempt Fund (VWITX). Effective immediately, the two funds will no longer accept new accounts from financial-advisor or institutional clients, but will remain open to these clients for additional purchases. Retail clients may continue to establish new accounts and make additional purchases without limitation.
