Vanguard has launched an actively-managed global bond fund designed to combat increasingly competitive bond fund pricing, the company has announced.
The Vanguard Global Credit Bond fund will be managed by Vanguard’s fixed income group, which currently has over $1.2 trillion in assets under management.
It will invest in a diverse range of bonds including high quality bonds from corporate issuers, government agencies and suprantational organisations around the world.
Despite the low-yield environment, the asset manager said bonds still act as a diversifier in investors’ portfolios.
Vanguard said the new fund costs less than all the actively-managed global credit bonds funds currently available in the UK market.
Commenting on the launch, Paul Malloy, the head of fixed income for Vanguard in Europe, said: ‘The fund will typically have lower volatility than high yield bonds or equities, helping to offset a portfolio’s return volatility.
'Investors should also pay close attention to costs, as the impact of fees is amplified in a low-yield market environment.’
The new fund is domiciled in Ireland and registered for sale throughout Europe.