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All Contents © 2017The Kiplinger Washington Editors
Long-term investors of the set-it-and-forget-it variety may not have noticed that four Vanguard funds have come on the market in just the past 18 months.
And since new Vanguard funds don’t just pop up on a frequent basis, it’s wise to periodically look back and review the latest additions to what is arguably the greatest selection of high-quality, low-cost mutual funds in the investment universe.
For a bit of perspective on the Vanguard funds lineup, there are 126 mutual funds (not including different share classes) available to investors and The Vanguard Group is about 42 years old. Do a little math and investors might expect to see about three new Vanguard funds per year.
In addition, before bringing new investments to market, Vanguard carefully considers what investors may need, rather than what the latest trends reveal. So, new Vanguard funds are not something to ignore.
With that backdrop in mind, let’s take a look at the four latest Vanguard funds you may not know about:
Prices and data are from the original InvestorPlace story published on August 15, 2017. Click on ticker-symbol links in each slide for current prices and more.
By Kent Thune
| August 2017
This slide show is from InvestorPlace, not the Kiplinger editorial staff.
Expenses: 0.25%, or $25 annually per every $10,000 invested
Minimum Initial Investment: $3,000
Not every investor wants (or needs) a passively managed core bond fund, which may be one of the reasons Vanguard recently added Vanguard Core Bond (VCORX) to their lineup of mutual funds.
Vanguard also likely knows that rising interest rates can pose a disadvantage to bond index funds and they don’t want investors selling shares out of the biggest bond fund in the world, Vanguard Total Bond Index (VBINX), in favor of an actively managed core bond fund at a competing fund company.
As we highlighted in the recent story, 4 Vanguard Funds to Buy (and 3 to Avoid) for Higher Interest Rates, passive managers aren’t able to decrease interest rate risk by shifting assets more toward bonds with lower average durations; however active fund managers can do this (to some degree).
Now instead of jumping ship to another investment firm to get an actively managed core bond fund, investors can buy shares of VCORX, which came on the market in March of 2016.
Minimum Initial Investment: $1,000
With an inception date of July 12, 2017, Vanguard Target Retirement 2065 is the newest addition to the family of Vanguard funds.
VLXVX is a life-cycle fund designed for investors looking to retire between the years 2063 and 2067. With that goal in mind, this target retirement fund would be appropriate for investors who are in their early to mid-twenties now.
The asset allocation is approximately 90% stocks and 10% bonds and will slowly adjust toward a bond allocation over time. The holdings consist of four Vanguard funds — Vanguard Total Stock Market Index, Vanguard Total International Stock Index (VGTSX), Vanguard Total Bond Market II Index and Vanguard Total Bond Market Index.
Investors looking for yield outside of the U.S. should take a look at Vanguard International High Dividend Yield Index.
One of the two new Vanguard international income funds coming on board Feb. 25, 2016, VIHIX is a passively managed fund that tracks the FTSE AW ex US High Dividend Yield Index, which is a market-cap-weighted index consisting of stocks of companies located in developed and emerging markets that are expected to pay above-average yields from dividends.
Therefore shareholders can get exposure to hundreds of international stocks like Nestle (NSRGF), Royal Dutch Shell (RDS.A) and Novartis (NVSEF).
VIHIX charges a fee of 0.25% on both purchases and redemptions.
To accommodate investors looking overseas for dividend funds, Vanguard added Vanguard International Dividend Appreciation Index on Feb. 25, 2016, along with VIHIX.
VIAIX tracks the Nasdaq International Dividend Achievers Select Index, which consists of about 240 non-U.S. stocks of all market caps that have consistently increased dividends in the past.
The greatest allocation is to large internationals like Tencent Holdings (TCEHY), Nestle and Novartis.
VIAIX charges a fee of 0.25% on both purchases and redemptions.
This article is from Kent Thune of InvestorPlace. As of this writing, he held none of the aforementioned securities.
More From InvestorPlace
10 Great Vanguard Funds for Your Income Portfolio
4 Vanguard Bond Funds to Buy (And 3 to Avoid) for Higher Interest Rates
7 Cheap Index Funds to Build Your Portfolio Around
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