Four bond ETFs report lower fees VALLEY FORGE, Pa., April 29, 2022 /PRNewswire/ -- Vanguard today reported expense ratio changes for six funds across multiple ETF and mutual fund share classes with fiscal years ending December 2021. The changes include reductions for four broadly diversified bond ETFs and represent $8.8 million in aggregate net savings for investors.1 Vanguard's investor-owned corporate structure enables the firm to return value to shareholders through lower costs and reinvestments to improve capabilities, technology, and client experience.2 Expense ratio chan

Four bond ETFs report lower fees VALLEY FORGE, Pa., April 29, 2022 /PRNewswire/ -- Vanguard today reported expense ratio changes for six funds across multiple ETF and mutual fund share classes with fiscal years ending December 2021. The changes include reductions for four broadly diversified bond ETFs and represent $8.8 million in aggregate net savings for investors.1 Vanguard's investor-owned corporate structure enables the firm to return value to shareholders through lower costs and reinvestments to improve capabilities, technology, and client experience.2 Expense ratio chan

Bond traders predict that the Federal Reserve‘s interest-rate cuts will go well beyond what the agency has forecast for the next nine months. Traders in the U.S. rates options market expect a much higher 3 percentage points worth of cuts by March. This dwarfs the Fed’s recent projections of just 25 basis points of reductions by the end of 2024 and a total 125-basis-point cut by the end of next year, Bloomberg reported. Options-market activity related to the secured overnight financing rate over the past three sessions show a significant upside if the Fed reduced its key rate by 300 basis points to 2.25% by next year’s first quarter. Also Read: Bank Stocks Trend Upward As Fed Shares

Markets are expecting the neutral rate — a theoretical rate that remains stable due to full employment and stable inflation — to stay higher than policymakers are forecasting. What does this mean for bond exchange-traded funds? A higher neutral rate may limit the Federal Reserve’s ability to cut interest rates, possibly causing headwinds for bonds, Bloomberg reports. Forward contracts on the five-year interest rate in the next five years — a proxy for the market's view of where U.S. rates might land — have stagnated at 3.6%. That is down from last year's peak of 4.5%, but it's still more than one full percentage point higher than the average over the past decade and above the Fed's ow

The European Central Bank is universally expected to cut interest rates for the Euro area this week. Cutting back on interest rates for the first time in two decades can be seen as a positive sign for the dwindling European economy, which has been hit by slow growth and poor demographic patterns. Average inflation in Euro area countries has been mostly on a downward trend since last year, reaching an annual 2.4% in both March and April, down from a peak of 10.6% in October 2022. The measure, however, is very dynamic within the block, with figures as low as 0.4% for Lithuania and as high as 4.9% in Belgium. The ECB commenced its latest rate hike cycle in July 2022. Key ECB interes

Investors are growing increasingly concerned about the potential impact of the mounting U.S. debt on the bond market, with the issue expected to take center stage as the presidential election approaches. What Happened: The U.S. government’s debt is expected to balloon, potentially overshadowing an anticipated bond rally. This is due to the ongoing large fiscal deficits, which show no signs of abating ahead of the presidential election, Reuters reported on Friday. Investors are already adjusting their portfolios to mitigate potential losses if Treasury yields surge due to supply and demand imbalances. There are also concerns that the uncertainty surrounding the necessary debt for defici

A major trend shift is unfolding in the bond market, as key Treasury yields are currently testing the support of the crucial 200-day moving average, following the release of benign economic data that has cemented investor bets on Federal Reserve rate cuts. Last month, the inflation rate calculated using the consumer price index (CPI) came in at 3.4% compared to the same month last year, down from 3.5% in March, and in line with the forecasted 3.4% increase. The “core” inflation rate, which excludes volatile energy and food prices, also matched estimates, falling from 3.8% to 3.6%. April's inflation reading has raised hopes that the disinflation trend may restart after three consecutive

The bond market is showing new signs of unpredictability as expectations over Fed rate cuts shift with every new piece of economic data. Last week, Fed Chair Jerome Powell acknowledged that rate cuts for this year are being decided on a meeting-by-meeting basis. Therefore, it's not possible to predict how much the cost of borrowing will drop in 2024. However, some investors continue to price in at least three rate cuts this year. This took the S&P 500 and other market gauges to record heights last week. Investors priced in significant rate cuts for 2024 during the first two months, as inflation showed consistent signs of easing. But rising prices from February's CPI report came

Vanguard has become a towering figure in the world of exchange-traded funds (ETFs). As investors increasingly turn to ETFs for their diversification, lower costs, and liquidity, understanding the offerings and strategies of major players like Vanguard is essential. Yet, amidst this expansive array of financial instruments, one notable absence in Vanguard’s portfolio raises eyebrows: the lack of a Bitcoin ETF. Here, we delve into the five critical factors about Vanguard ETFs, also explaining why a Bitcoin ETF is deliberately missing from their portfolio lineup. Vanguard’s Status In The ETF Arena Vanguard ranks as the second-largest ETF issuer globally, overseeing a diverse p

As 2023 concludes, the bond market has witnessed a remarkable rally, bolstered by the strength of the U.S. economy and a reduction in inflationary pressures. Despite this, some analysts caution that investor optimism might be overly optimistic for the upcoming year, The Wall Street Journal reports. What Happened: This past year, the bond market's journey has been marked by significant volatility. The 10-year U.S. Treasury note yield, a key market indicator, has dramatically fluctuated. Initially driven to highs not seen in over a decade by concerns over persistent high interest rates, these yields have since retreated due to various factors, including banking sector stresses and shifts in

The traditional 60/40 investment portfolio has recorded a remarkable year of growth in 2023, sharply rebounding from a disappointing year in 2022. As of Dec. 27, the year-to-date performance of the 60/40 portfolio, benchmarked by the iShares Core Growth Allocation ETF (NYSE:AOR), stands at approximately 13%. This performance figure ranks as the third-best year for the strategy since its inception in 2008, trailing only behind the strong years of 2009 and 2019. As we enter the new year, investors are pondering whether the favorable conditions that supported both equities and bonds in the second half of the year will endure. 60/40 Portfolio In 2022-2023: From Downturn to Upswing T

New research from Goldman Sachs reveals that U.S. Exchange-Traded Funds (ETFs) have surpassed the threshold of $8 trillion in assets under management (AUM), setting an all-time high this week. This milestone is another clear indicator of the robust health of the investment landscape in the United States, as major stock market indices trade at or near their record levels. The S&P 500, for instance, has rallied by 25% year to date, trading at a mere 1% distance from its all-time highs. Tech stocks in the Nasdaq 100 have soared 53% year to date, hitting a record high on Tuesday. But the increase in the ETF market size isn't just about a bullish stock market. Rising assets among U.S.