VALLEY FORGE, PA (December 5, 2019)—Vanguard today announced plans to launch a new, broad market international bond index fund, Vanguard Total International Bond II. The fund will serve as the international fixed income component for the firm’s industry-leading Vanguard Target Retirement series1 and LifeStrategy Funds.
Vanguard Total International Bond II Index Fund will mirror the investment strategy of Vanguard Total International Bond Index Fund and will seek to track the same benchmark index, Bloomberg Barclays Global Aggregate ex-USD Float Adjusted RIC Capped Index (USD Hedged).
“As our Target Retirement series and LifeStrategy Funds have grown, they have become increasingly large shareholders of their underlying index funds,” said Vanguard Chief Investment Officer Greg Davis. “We believe it is in the best interest of shareholders to segregate the transaction costs produced by these funds of funds from the costs generated by other investors in the Total International Bond Index Fund.”
Upon launch in early 2020, Vanguard Total International Bond II Index Fund will receive new cash flows from the Vanguard Target Retirement series and LifeStrategy Funds. The funds of funds’ current holdings in Vanguard Total International Bond Index Fund will be transitioned to the new fund in a prudent and tax-sensitive manner over time. The investment strategies, asset allocations, glide path, and expense ratios of the funds of funds will not change.
In 2009, Vanguard enacted a similar change with the launch of Vanguard Total Bond Market II Index Fund, which provides exposure to the U.S. bond market for the Vanguard Target Retirement series and other funds of funds.
Vanguard: The target-date fund leader
Since 2003, investors have gravitated to Vanguard’s Target Retirement series for enduring, professionally managed, low-cost retirement savings options. With more than $800 billion in assets under management, Vanguard’s Target Retirement series is now the largest family in the target-date fund industry.
Vanguard’s Target Retirement series offers a simple yet sophisticated investment approach that reflects the firm’s long-standing and time-tested investment philosophy. The series provides investors with a single, low-cost solution that offers diverse, global exposure across five asset classes, 25 sub-asset classes, and nearly 29,000 securities, along a research-based glide path that rebalances over time.
Vanguard is one of the world’s largest investment management companies. As of October 31, 2019, Vanguard managed $5.9 trillion in global assets. The firm, headquartered in Valley Forge, Pennsylvania, offers 423 funds to its more than 30 million investors worldwide. For more information, visit vanguard.com.
All figures are as of October 31, 2019, unless otherwise noted.
For more information about Vanguard funds, visit vanguard.com to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing.
All investing is subject to risk, including the possible loss of the money you invest. Bond funds are subject to the risk that an issuer will fail to make payments on time, and that bond prices will decline because of rising interest rates or negative perceptions of an issuer's ability to make payments.
Investments in Target Retirement Funds are subject to the risks of their underlying funds. The year in the fund name refers to the approximate year (the target date) when an investor in the fund would retire and leave the workforce. The fund will gradually shift its emphasis from more aggressive investments to more conservative ones based on its target date. An investment in a Target Retirement Fund is not guaranteed at any time, including on or after the target date.
Mutual funds, like all investments, are subject to risks. Each LifeStrategy Fund invests in four broadly diversified Vanguard funds and is subject to the risks associated with those underlying funds.
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1 The Target Retirement series includes Vanguard’s Target Retirement Funds, Institutional Target Retirement Funds and Target Retirement Trusts.