In late June, a series of SEC filings from Vanguard elicited a firestorm of commentary and reporting in the media and no doubt any number of backroom discussions in the offices of its competitors.
The firm is planning to launch a series of ETFs linked to major U.S. equity indexes from Russell Investments and Standard & Poor’s. These will include the U.S. market’s third S&P 500 ETF. The new fund will undercut both the SPDR S&P 500 (NYSE Arca: SPY) and the iShares S&P 500 Index Fund (NYSE Arca: IVV) in terms of price, charging just 6 basis points. A separate filing outlines funds that will track the S&P MidCap 400 and S&P SmallCap 600, as well as value and growth indexes for each of the three benchmarks. Yet another filing details funds tied to the Russell 1000, 2000 and 3000 indexes, as well as the growth and value subsets of the Russell 1000 and 2000.
Also in the works are funds tied to indexes from S&P that track the global ex-U.S. real estate market and the short-, intermediate- and long-term municipal bond markets. In all, Vanguard filed papers on 20 new ETFs in a single day. In each case, the fees outlined for the funds were among the cheapest in their respective asset classes.
The move suggests that the third-largest ETF provider is looking to compete directly with the two dominant ETF firms, State Street Global Advisors and BlackRock. |
