Vanguard launches two new ETFs focused on environmental, social and governance (ESG) topics. The two new ETFs – the Vanguard ESG EUR Corporate Bond UCITS ETF and the Vanguard ESG USD Corporate Bond UCITS ETF – were developed as core components for implementing ESG-aligned portfolios. The new ETFs were listed on Borsa Italiana, the London Stock Exchange (LSE), Deutsche Börse, Six Swiss Exchange and Euronext Amsterdam.
“The two newly listed ETFs give investors additional core components to implement broadly diversified and balanced portfolios, at low cost, to align with their sustainability preferences,” he remarks. Fong Yee Chan, responsible for Vanguard’s ESG strategy for the UK and Europe.
Simone Rosti, responsible for Italy and Southern Europe of Vanguardadds: “The launch of these products responds to the demand for investment solutions core ESG by investors. At the same time, the newly launched products are aligned with Vanguard’s philosophy of broad diversification, long-term orientation and low cost. This way, investors can combine the best of both worlds with components core portfolio that meet ESG criteria and reflect the traditional values of Vanguard”.
Replicated indices and costs
Il Vanguard ESG EUR Corporate Bond UCITS ETF it tracks the Bloomberg MSCI EUR Corporate Liquid Bond Screened Index and has an overall cost (“OCF”) of 0.11% for unhedged share classes and 0.16% for hedged share classes.
Il Vanguard ESG USD Corporate Bond UCITS ETF tracks the Bloomberg MSCI USD Corporate Float-Adjusted Liquid Bond Screened Index and has an overall cost (“OCF”) of 0.11% for unhedged share classes and 0.16% for covered shares.
Vanguard’s ESG funds are exclusionary based and replicate benchmark commonly used and derived from market capitalization weighted indices, developed by index provider independent, offering weighted exposure to companies in their target markets. The index provider selected by Vanguard apply transparent selection criteria to avoid or reduce exposure to certain industries or businesses that may not align with investors’ ESG preferences, such as firearms, tobacco or fossil fuels.
The new ETFs are managed by Vanguard’s Fixed Income Group, which has more than $1.6 trillion in assets under management globally and draws on the diverse perspectives and expertise of its more than 170 team members.