Vanguard Investments Canada Inc. (Vanguard) today announced that its lineup of 11 high-quality, low-cost exchange-traded funds (ETFs) has surpassed $1 billion in assets under management.
“We are grateful for the trust that financial advisors and their clients have placed in us,” said Atul Tiwari principal and managing director of Vanguard Investments Canada.
Vanguard entered the Canadian market in December 2011, listing six ETFs on Toronto Stock Exchange (TSX), and in November 2012, Vanguard added another five ETFs. Vanguard also recently filed a preliminary prospectus with the Canadian regulatory authorities for seven new ETFs (five equity ETFs and two bond ETFs).
Vanguard believes that its growth can be attributed to the acceptance of the indexing approach, which offers low costs, broad diversification, relative performance predictability, and tax efficiency.
Costs are particularly important. As of December 31, 2012, Vanguard Investments Canada’s ETFs have an average management expense ratio (MER) of 0.27%. That compares with an average MER of 2.03% for all mutual funds in Canada*.
“You can’t control market performance, but you can control how much you pay for your investments,” Mr. Tiwari said. “All else being equal, investments with consistently low MERs can give you a head start in achieving competitive returns.”
Vanguard’s investment approach has also been embraced by advisors, who are constructing balanced, broadly diversified portfolios for their clients using low-cost ETFs. Vanguard has long been a proponent of the advisor’s alpha concept, under which an advisor creates value for clients through sound asset allocation, behavioural coaching, rebalancing, and tax planning.
Vanguard Investments Canada Inc. is a wholly owned indirect subsidiary of The Vanguard Group, Inc. Vanguard is one of the world’s largest investment management companies and a leading provider of company-sponsored retirement plan services. Vanguard manages more than $2.45 trillion in global assets. The firm offers more than 160 funds to U.S. investors and more than 80 additional funds in non-U.S. markets. For more information, please visit vanguardcanada.ca.
All asset figures are as of June 30, 2013, unless otherwise noted.
*Average management expense ratios for all Canadian-domiciled mutual funds and exchange traded funds are unaudited, reported by Morningstar, Inc. and calculated by Vanguard as of December 31, 2012.
Commissions, management fees and expenses all may be associated with the Vanguard ETFs™. This offering is only made by prospectus. The prospectus contains important detailed information about the securities being offered. Copies are available from Vanguard Investments Canada Inc. at www.vanguardcanada.ca. Please read the prospectus before investing. ETFs are not guaranteed, their values change frequently, and past performance may not be repeated.