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February 3, 2014updated 04 Apr 2017 2:32pm

Vanguard Asset Management unveils global short-term bond index fund

Vanguard Asset Management has unveiled its new global short-term bond index fund for investors to manage volatility in their portfolios.

By Verdict Staff

Vanguard Asset Management has unveiled its new global short-term bond index fund for investors to manage volatility in their portfolios.

With a total expense ratio of 0.2% on its sterling share classes, the Vanguard Global Short-Term Bond Index fund will track the Barclays Global Aggregate 1-5 Years ex-US MBS Float Adjusted Bond Index.

Additionally, the fund will invest across geographies and assets, including governments, investment grade corporates and ex-US securitized mortgages.

Furthermore, the new fund will be managed on a hedged basis to help reduce the volatility and preserve the risk-return profile of the underlying asset class.

Nick Blake, head of retail at Vanguard, said: "Short-term bond funds are an important part of an adviser’s risk management tool kit and advisers tell us they do not have enough choice in this space. I am very pleased that we can bring this fund to market with Vanguard’s signature of global diversification at very competitive costs."

Axel Lomholt, product head for international business at Vanguard said: "Not only do global short-term bonds provide stability and diversification, they also play a valuable role in protecting the downside risk of portfolios."

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