Bogleheads

[stratton]

From Index Universe Vanguard Files To Launch Seven Index Funds & ETFs

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[Hexdump]

Vanguard Short Term Bond ETF (BSV)

and

Vanguard Intermediate Term Bond ETF (BIV)

etc. ?

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[eurowizard]

Lets see if they get the Long Term Corporate Bond Fund will exclude callable bonds. Otherwise its worthless.

[EyeDee]

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Sadly Vanguard is leaving the traditional retail investor out of the index market. For those people who do not want the complications of a brokerage account if they want to hold these bond fund areas, you have to either use active funds (index like funds, but still they are active funds) or hold funds that combine areas by using the current bond index funds.

Vanguard is definitely starting to leave the retail investor behind who needs to keep things simple including those who want to keep things simple for a spouse to handle if something happens to them.
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Randy

SSCA - Security (ER fund, insurance), Savings, Costs (inc. taxes), Allocation (inc. rebalancing).
Board Wiki

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[EyeDee]

[stratton]

[csoren]

Where are the national muni bond funds ????

Total net assets ($ billion)

[stratton]

[Kenster1]

So this will be interesting competition for the existing VG bond funds.

For example -- we have a new filing for a Vanguard Short-Term Corporate Bond Index Fund which seems very close to the current and popular Short-Term Investment-Grade Fund, except the latter is actively-managed and can hold a bit of Treasuries (I believe up to 20%).
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SURGEON GENERAL'S WARNING: Any overconfidence in your ability, willingness and need to take risk may be hazardous to your health.

[Eric]

Wasn't it just a few years ago that Vanguard converted its corporate bond funds to "investment grade" bond funds with a broader investment mandate? I remember spirited comments about this on the old M* forum. A number of posters (including Rick Ferri) were concerned that Vanguard would no longer offer "style-pure" bond funds. That led Rick and others to switch to iShares to fill this part of their asset allocation . . . so now we come full circle.

[livesoft]

[eurowizard]

[EyeDee]

[SpaceCommander]

Still no International Bonds from Vanguard. iShares has them. If Vanguard wants to offer a broader array of asset classes, I think they still have some catching up to do.

Granted, many Bogleheads think international bonds are unnecessary, however...
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I honor my personality flaws, for without them I would have no personality at all.

[livesoft]

[pastafarian]

[DualCitizen]

[jeffyscott]

[livesoft]

I hold Vanguard mutual funds directly at WellsFargo. I pay no more fees at WellsFargo for the Vanguard funds than I do for the Vanguard funds I hold at Vanguard directly. That is, there are no fees. There are no fees for the brokerage as well. There are no transaction fees for ETFs. There are no transaction fees for Vanguard mutual funds. There are no transaction fees for non-Vanguard mutual funds that are available.

Vanguard would charge me fees for the ETFs. WellsFargo does not. Vanguard charges fees for some of their mutual funds. I can buy the ETF share class at WellsFargo and not pay that fee and not pay a brokerage fee.

For most people, an investment is simply a symbol on a web page. They can't tell the difference between the symbol VTI and the symbol VTSMX.

[SpringMan]

Generally ETFs are no worse than mutual funds as far as hassle goes. One exception would be tax loss harvesting, selling and buying a replacement ETF. One should understand stock trading concepts like limit orders, all or none, good to canceled or good for day etc. There is a need to monitor the ETF price to intelligently place a limit order. Market orders can be dangerous, IMHO. With a mutual fund, it just requires an exchange. We currently own both. My spouse has little interest in this so eventually I plan to simplify to just a few funds, maybe Wellesley or Target Income. The problem is I could die before the eventually comes. Perhaps one of our sons could help if this happens. I think spouses are often smarter than we give them credit for.
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Best Wishes,
SpringMan

[tarnation]

[livesoft]

[jeffyscott]

[livesoft]

yep, you are missing something: http://www.bogleheads.org/foru....hp?t=35823

[gchan]

[sgr000]

[jeffyscott]

[tarnation]

[Doc]

If the I-shares Premium/discount charts since the credit crunch are any guide I can't see how these new Vg offerings are going to be much use to retail invetors.

http://www.barclays.wallst.com....ter=2-2009

Look at periods before and after the credit meltdown. The premium is just too great to tolerate. Competition from Vg might just make it take longer to get back to something reasonable.
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Regards,

Doc

"Knowledge is just hard-drive stuff. It's not intelligence." Lawrence O'Donnell

[pastafarian]

[jeffyscott]

[EyeDee]

[jeffyscott]

Luckily I've only used the term "LQD" about three times, so I was able to find the discussion where Rick had indicated that he does not use bond ETFs:

http://www.bogleheads.org/foru....torder=asc
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Jeffy

press on, regardless - John C. Bogle

[EyeDee]

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Jeffy,

Thank you.

Although I am pretty sure the article was referenced here more recent than the conversation you referenced, it could have been published before the conversation you referenced. Either way, Rick obviously indicated he has stopped using the LQD ETF.
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Randy

SSCA - Security (ER fund, insurance), Savings, Costs (inc. taxes), Allocation (inc. rebalancing).
Board Wiki

[giacolet]

EyeDee wrote:

[bmb]

Of course ETFs are a bit more complex. They have brokerage fees the effects of which a naive investor may not be fully aware of. They also have bid/ask spreads which are even more complex. And there is a risk of a lot more bad choices among the vast array of complex ETFs rather than staying with good old Vanguard funds. These complexities afford the brokerage - as well as some investors - advantages over mutual funds. The primary reason ETFs are becoming so popular among brokers is they generate $ from trades.
One might argue that a naive investor can and should eschew all complexity and just use broad-based funds, so you owe it to your spouse to keep it that way.

[jeffyscott]

EyeDee,

Rick also stated this, back there: "Although I write about bond ETFs, I do not use them in our business..."
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Jeffy

press on, regardless - John C. Bogle

[mfen]

Maybe I am missing something here, but etf's can be shorted, right? This is my main gripe with etf's vs index mutual funds. The mutual funds are somewhat protected from the speculators, but the etf's are not. I never see this risk factor discussed on etf boards. Someone more educated than me please detail the effects.
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Maryanne

[azxcvbnm321]

Index mutual funds can be shorted as all the underlying securities are known. Someone just shorts all the components if there is no corresponding ETF to short. I don't think shorting is much of a factor in regards to index funds and ETFs. Most of these track indexes with huge volume (in the underlying components) and so manipulation is very difficult, unlike with penny stocks and Pink Sheet stocks that can be manipulated.

The big boys can always short an index, they don't need an ETF, they have computer programs that can sell thousands of stocks at once. Only the little guys will have problems shorting an index not tracked by an ETF.

I applaud Vanguard for giving the retail investor more options at rock bottom expense ratios. For people who want to set their own asset allocations, more options allow for better fine-tuning. For those who want to keep it simple, they can still do that or use the Target Retirement Funds. If you need to fine tune more than the Target Retirement Funds allow, you are no novice and thus could use the extra offerings by Vanguard. I use the Target Retirement 2040 for my taxable account since I don't have enough money to buy the minimum in each fund I would need. With Target Retirement, Lifestyle, Star, Balanced, and Asset Allocation along with Total World Stock Index, Vanguard has plenty for those who don't want to spend much time figuring out asset allocations or who don't have the knowledge. I see nothing but positives from this news.

Vanguard changed their short term corporate to short term investment grade because they said they were having trouble finding enough quality corporate bonds to invest in and wanted more flexibility. I wonder how that's changed enough for them to offer a short term corporate bond fund.

[Doc]

[Sammy_M]