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Vanguard Again Dominates Inflows


Vanguard, the third-largest U.S. provider of exchange traded funds, is again dominating ETF inflows.

In the first quarter, “Vanguard attracted $13.1 billion, or almost 90 percent of the money gathered by all U.S. ETFs,” reports Christopher Condon for Bloomberg. Pennsylvania-based Vanguard has hauled in more than seven times as much cash into its ETFs this year as the rest of the industry combined, according to Bloomberg.

Vanguard finished the first quarter with $351.1 billion in ETF assets, well behind the $673.1 billion held by BlackRock’s (BLK) iShares unit. State Street’s (STT) State Street Global Advisors is the second-largest U.S. ETF sponsor with $379.5 billion in ETF assets. Invesco’s (IVZ) PowerShares is the only other U.S. ETF issuer currently residing close to $100 billion in ETF assets.

Lead by the Vanguard FTSE Europe ETF (VGK) , six Vanguard ETFs rank among the top-10 asset gatherers this year. With VGK in the first spot, the top-four ETFs in terms of 2014 inflows are all Vanguard products. Last year, Vanguard pulled in nearly a third of every dollar investors allocated to U.S. ETFs. [Vanguard Keeps Hauling in ETF Cash]

iShares is the only other issuer to have more than one ETF in this year’s top-10 for inflows and Vanguard has just one ETF on the 10 worst outflows list: The Vanguard FTSE Emerging Markets ETF (VWO).

Vanguard ETFs are popular with investors due in part to robust liquidity and some of the lowest fees in the industry. Earlier this year, the company reduced expenses on five of its ETFs, including VWO. In April 2013, the firm lowered fees on seven ETFs, which followed 22 expense reductions in late 2012.[Vanguard Lowers Fees on Five ETFs]

Vanguard does not introduce as many new products as rival issuers, but when it does bring new ETFs to market, most quickly prove successful. For example, th e Vanguard Total International Bond ETF (BNDX) and the Vanguard Emerging Markets Government Bond ETF (VWOB) are two of the most successful ETFs that launched last year. [A Good Year for New ETFs]

Of the 30 largest U.S. ETFs, 10 are Vanguard funds, a group that includes VWO, VGK and the Vanguard Dividend Appreciation (VIG) .

Vanguard Dividend Appreciation ETF

ETF Trends editorial team contributed to this post.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.