Vanguard Eyes Active Fixed Income ETFs

Vanguard Eyes Active Fixed Income ETFs

Amid a 'new era of fixed income investing'

Reviewed by: Staff
Edited by: James Rubin

Vanguard is eyeing entry into the active fixed income ETF space as it looks to capitalize on the booming market in Europe.

Speaking at ETF Stream’s ETF Ecosystem Unwrapped 2024 event, Robyn Laidlaw, head of distribution for Europe at Vanguard, said it could launch active ETFs as we enter a “new era of fixed income investing”.

“There is a lot of opportunity," she said. "For investors on the fixed income side, we clearly are into a new era of fixed income investing.

“Active ETFs would not be off the table for us, but you have to get the right type of active in portfolios.

“I completely understand why active managers would be looking to the ETF market because there have been massive outflows year on year, so it is important to find opportunities in ETFs.

“If we were looking at active, it would be in the line of fixed income.”

The passive giant has a 19-strong range of active fixed income mutual funds but has yet to unveil comparable strategies in an ETF format.

Top ETF Issuers in Europe

JP Morgan Asset Management is currently the largest active ETF provider in Europe and last October debuted the JPMorgan Active Global Aggregate Bond UCITS ETF (JAGG).

Other big hitters in the European active fixed income space include PIMCO, AXA Investment Managers, Franklin Templeton and Fidelity International.

Fund selectors have been vocal on the desire for further product development in the active fixed income ETF space, with asset classes such as high yield and emerging markets “ripe for innovation”.

Meanwhile, Janus Henderson’s entry into European ETFs marked an opportunity for the firm to disrupt the active bond space after it announced plans to acquire fixed income specialist Tabula Asset Management.

Earlier this month, Vanguard appointed BlackRock’s former global head of iShares Salim Ramji to replace Tim Buckley as CEO.

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