Vanguard has expanded its active fixed income fund lineup with a new emerging markets bond fund.
The Vanguard Emerging Markets Bond Fund invests in a broadly diversified portfolio of debt issued by emerging market governments and government-owned enterprises, with a majority of its assets either denominated in, or hedged back to, the U.S. dollar.
The fund’s investment advisor is Vanguard Fixed Income Group, which has more than $1.3 trillion under management across both index and actively managed funds.
Vanguard currently manages $4.5 billion in emerging markets bond assets in its active fixed income funds, and has been investing in the asset class as a sub-allocation across Vanguard’s active credit lineup since 2013.
“Emerging market debt is a well-established asset class offering credit exposure and diversification that is complementary to corporate and high-yield bonds,” John Hollyer, global head of Vanguard Fixed Income Group, said in a statement. “The fund provides investors with low-cost, broad exposure to emerging fixed income markets.”
Vanguard considers emerging market countries as countries whose economies and capital markets are less developed – which includes most countries except for Australia, Canada, Japan, New Zealand, the United States, the United Kingdom and most eurozone countries.