Competition in the Bond ETF Market Heats Up

by: Tom Lydon

Vanguard is expanding its role in the bond ETF market by filing for seven new bond funds with the SEC.

Investment heavyweight provider Vanguard has filed with the SEC to launch seven new bond-focused ETFs. This is viewed as a direct challenge to iShares, which leads the fixed-income investment category.

David Hoffman for Investment News says that three of the ETFs are expected to invest in U.S. Treasuries, three in corporate bonds and one in mortgage-backed securities, according to the filling. The ETFs stay consistent with Vanguard’s strategy to offer low-cost ETFs. Each new fund has an expense ratio of 0.15%.

iShares currently charges 0.15% for U.S.-backed Treasuries, 0.20% for corporate bonds, and 0.25% for mortgage backed securities. Let the competition begin…