Vanguard to expand active range
Vanguard is planning to launch several new active products to the Australian market, as it moves away from a focus on index funds and ETFs.
The firm said the new products would be available ‘within the next few weeks’ and would offer traditional active stockpicking investments, rather than a factor-based offering.
The new products already had track records, having been run in overseas markets for some years.
Vanguard already offers four factor-based strategies in Australia including a Minimum Volatility fund, which it said was particularly popular in this market environment, and a Value Equity fund.
A spokesperson for Vanguard said: “We are really focused on our active offering, it is early days and it has been a challenge as people know us for index investing. There is a lot more competition in the active space but we think we can offer a low-cost alternative. We will always be competitively priced versus other active funds.
“We want to be able to provide choice for investors. We believe outperformance can be improved by investing in a low-cost way and we want to offer greater choice in our own range.”
In Australia, the firm is best known for its exchange traded fund (ETF) products and this year marks 10 years of ETFs, which now have over $16 billion in assets under management.
The largest of these was the Australian Share Index ETF which was now one of the largest ETFs in Australia at over $4 billion.
While most of its 28 ETFs were index funds, the firm had also been launching actively-managed ETFs but said it was ‘early days’ for these type of assets.
“It is early days and education is needed as they are hard for people to get their head around. It is an emerging area for ETFs and they will take a while for them to bed themselves in but then that was also the case for ETFs when they first launched.”
The Vanguard Australian Shares Index ETF has returned 8.7% over one year to 3 September, according to FE Analytics, versus returns of 5.3% by the ACS Equity-Australia sector.
AUTHOR
Laura Dew
Recommended for you
Outflows have doubled in the property and infrastructure space to $1.3 billion with advisers instead favouring private markets as Morningstar data finds active property funds are struggling to outperform.
Fund manager HMC Capital is seeking to expand fundraising for its private equity vehicle into wholesale platforms now that it has achieved a three-year track record, while scrapping plans for a second fund.
Former Platinum co-founder James Simpson will take up a non-executive role at Income Asset Management as two directors retire.
Bell Financial Group has announced a 44 per cent decline in half-year net profit after tax but record funds under advice as it transitions into a diverse wealth management business.
