Vanguard has filed initial registration statements with the U.S. Securities and Exchange Commission to introduce two new active fixed income funds: Vanguard Core-Plus Bond Fund and Vanguard Multi-Sector Income Bond Fund. The funds are designed to meet the needs of clients seeking actively managed “core” and “satellite” bond portfolios and will augment the lineup of higher-alpha, diversified fixed income strategies managed by Vanguard Fixed Income Group.
“Vanguard has invested heavily in active management talent and capabilities for decades, resulting in a lineup of active bond funds that leverage proven portfolio manager expertise and help clients achieve investment success,” said Kaitlyn Caughlin, head of Vanguard Portfolio Review Department. “Vanguard’s client-centric approach to product development has produced a carefully curated lineup that drives long-term value and meets evolving investor needs.”
The new funds represent Vanguard’s ongoing efforts to improve investor outcomes through single-fund fixed income strategies with enduring investment merit and low costs.
Core-Plus Bond will consist of a broadly diversified portfolio invested primarily in Treasury, mortgage-backed, and other U.S. investment-grade securities. Also, the fund may invest beyond the U.S. investment-grade bond market in areas such as high-yield corporate securities and emerging markets debt of all credit quality ratings. Core-Plus Bond will be differentiated from Vanguard Core Bond Fund in its incremental flexibility across higher-alpha potential sectors, particularly in its greater exposure to high-yield and emerging markets.
Multi-Sector Income Bond will offer exposure primarily to U.S. investment-grade securities, U.S. high-yield corporate securities, and emerging markets debt of all credit quality ratings.
Vanguard expects to make Core-Plus Bond available to investors in the fourth quarter of 2021 and Multi-Sector Income Bond available for public investment at a later date.
