Vanguard Cuts ETF Fees
We see the cuts as a directional improvement for investors, but they do not impact our Morningstar Analyst Ratings.
On Feb. 26, 2019, Vanguard announced that it is cutting the expense ratios for 10 exchange-traded funds, including Vanguard FTSE Emerging Markets ETF (VWO), Vanguard FTSE Europe ETF (VGK), Vanguard FTSE Pacific ETF (VPL), Vanguard FTSE All-Wld ex-US ETF (VEU), Vanguard FTSE All-World ex-US Small-Cap ETF (VSS), Vanguard High Dividend Yield ETF (VYM), Vanguard Total World Stock ETF (VT), Vanguard Tax-Exempt Bond ETF (VTEB), Vanguard Total International Bond ETF (BNDX), and Vanguard Total International Stock ETF (VXUS).
Per Vanguard, these fee cuts were a response to the increased adoption of ETFs as a preferred vehicle, allowing the firm to pass along the cost savings from scaling these investment strategies. Vanguard has historically charged the same fee for a given fund's ETF and Admiral share classes. This marks the first time that the ETF share class will charge less than the Admiral share class. These funds continue to rank among the low-cost leaders in their respective Morningstar Categories. So, these fee cuts are a directional improvement for investors but do not impact our Morningstar Analyst Ratings.
Daniel Sotiroff does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.
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