A New Vanguard Fund On Our Radar

Emory Zink: While renowned for its indexing execution, Vanguard has also evolved into a firm with a wide range of resources that lend it advantages in the actively managed space. On our radar is Vanguard Core Bond Fund (VCORX)--a member of the open-end intermediate-term bond category. Incepted earlier this year, the fund has a short track record, but there are ample reasons to follow its progress.

First, each of the three named portfolio managers have spent more than a decade at Vanguard and are supported by the firm's deep credit analyst, risk analysis, and economic research teams.

Second, for an actively managed core fixed-income product, its 25 basis point net expense ratio is one of the lowest in the category--a trademark of most Vanguard products.

And third, when asking, why this actively managed fund at Vanguard, a firm most often associated with passives, and why now, it seems appropriate to consider the economies of scale offered across Vanguard's global operations that have grown dramatically in the last decade, as well as recognition that the fixed-income landscape is evolving, and that past sources of value might not behave identically in the future.

These reasons, coupled with Vanguard's reputation for prudent management, leave us curious and optimistic about this fund's future.