What to do? Vanguard Muni Funds Closed to New Investors
What to do? Vanguard Muni Funds Closed to New Investors
Now that that VWITX and VWIUX are closed to new investors, what should I do for Muni bond exposure in a taxable account?
Re: What to do? Vanguard Muni Funds Closed to New Investors
I don't think they are closed if you have an account at Vanguard. However, I have read that Fidelity has a good Intermediate fund: FLMTX
Re: What to do? Vanguard Muni Funds Closed to New Investors
When did this happen?
Re: What to do? Vanguard Muni Funds Closed to New Investors
Please provide a link to a source if you believe these funds are closed to new investors.
Otherwise, I think you are mistaken.
Otherwise, I think you are mistaken.
Warning: I am about 80% satisficer (accepting of good enough) and 20% maximizer
Re: What to do? Vanguard Muni Funds Closed to New Investors
My Schwab account lists these as "Open to existing investors." Interestingly enough, VMLTX (Limited Term) is still listed as "open."
Re: What to do? Vanguard Muni Funds Closed to New Investors
I think it is closed to new investors who get it from a source outside of Vanguard. See: https://advisors.vanguard.com/VGApp/iip ... ure=140469 and https://institutional.vanguard.com/VGAp ... undId=0542
Re: What to do? Vanguard Muni Funds Closed to New Investors
OK, here's the explanation.
https://advisors.vanguard.com/VGApp/iip ... ngTwoFunds
The easy solution is to buy it at Vanguard.
https://advisors.vanguard.com/VGApp/iip ... ngTwoFunds
The easy solution is to buy it at Vanguard.
Warning: I am about 80% satisficer (accepting of good enough) and 20% maximizer
Re: What to do? Vanguard Muni Funds Closed to New Investors
You might also consider investing in TFI or VWAHX. Both are intermediate term muni bonds funds. TFI is the Barclay index ETF that holds a equivalent index of all muni bonds. It has a ER of .23% and a current dividend yield of 2.86%. According to Morningstar it performs better than VWITX. Or if you can take a little more risk you might also consider investing in VWAHX, Vanguards Hi Yield Tax Exempt. VWAHX has a ER of .12% for Admiral shares and a dividend yield of 3.09%. It is also rated 5 stars by Morningstar.
http://quote.morningstar.com/fund/chart ... ture=en-US
Cheers, Bill
http://quote.morningstar.com/fund/chart ... ture=en-US
Cheers, Bill
Re: What to do? Vanguard Muni Funds Closed to New Investors
If you're looking for a high credit quality intermediate-term muni fund (even better credit quality than VWITX/VWIUX), you might consider Baird Intermediate Municipal Bond (BMBSX, investor shares, and BMBIX, institutional shares). I have accumulated lots of VWIUX and haven't sold any, but for the last three years I've been buying BMBIX exclusively, through my Vanguard brokerage account. Although the yield is slightly lower, I feel very comfortable that the credit risk is about as low as you can get, though it should be said that the consensus among those who know more than I do about it (people like Larry Swedroe) is that VWITX/VWIUX satisfies the "take your risk on the equity side, not the bond side" guideline.
Eric
Eric
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Re: What to do? Vanguard Muni Funds Closed to New Investors
I inadvertantly broke this news in another thread when discussing closed and CEFs. I too was surprised to learn that it was closed to new investors except when purchasing through VG.
Re: What to do? Vanguard Muni Funds Closed to New Investors
With respect to the suggestion of possibly buying an ETF instead, I would note that some in the past have voiced concern over increased volatility of ETF's due to on-demand liquidity issues. In the figure below, blue is Vanguard Intermediate, orange is Baird Intermediate and Green is Barclays ETF (TFI). Over the long term, the differences probably aren't all that significant.
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Re: What to do? Vanguard Muni Funds Closed to New Investors
It does raise the question as to whether these funds are transferable to other custodians.
Brian
Brian
Re: What to do? Vanguard Muni Funds Closed to New Investors
TIger I suggest you do some more research. TFI did not exist before September 2007. I suspect you are looking at some other benchmark.
Bill
Bill
Re: What to do? Vanguard Muni Funds Closed to New Investors
Bill, thank you. I double checked. The chart is from Morningstar. It only goes back 6 months to January 2013, which is why I said that long term the differences may be less significant.
Tiger
Tiger