If you’re looking for an ASX ETF in the Fixed interest – International sector, chances are, the Vanguard Global Aggregate Bond Index (Hedged) ETF (ASX: VBND) is an ETF you’re considering. Here’s what you need to know.
How ASX investors can use the VBND ETF
The Vanguard VBND ETF provides investors with exposure to government debt and investment-grade corporate debt from developed markets around the world.
VBND may be used by investors to gain exposure to global debt markets, providing diversification benefits to an existing equity or Australian debt portfolio. It may also be used by investors seeking to gain a regular income stream from the quarterly distributions.
VBND meets our minimum market cap (FUM) criteria
The Vanguard VBND ETF had $460.26 million of money invested when we last pulled the monthly numbers. Given VBND’s total funds under management (FUM) figure is over $100 million, the ETF has met our minimum criteria for the total amount of money invested, otherwise known as FUM. We draw the line at $100 million for ETFs in the Fixed interest – International sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
VBND ETF fees explained
Vanguard charges investors a yearly management fee of 0.20% for the VBND ETF. This means that if you invested $2,000 in VBND for a full year, you could expect to pay management fees of around $4.00.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.51% or around $10.20 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Putting it all together
If you’re weighing up investing in VBND, keep in mind that this is just a brief introduction to the ETF. To supercharge your research, take a look at our free Vanguard VBND report. Then, consider searching our complete list of ASX ETFs for similar ETFs in the Fixed interest – International sector to compare your options.
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