VALLEY FORGE, Pa.--(BUSINESS WIRE)--Vanguard plans to change the target benchmark of its Total International Stock Index Fund from the MSCI® EAFE® + Emerging Markets Index to the MSCI All Country World ex USA Investable Market Index. The fund’s new target index covers 98% of the world’s non-U.S. markets, including the European, Pacific, and emerging market regions, as well as Canada. The index includes more than 6,000 issues encompassing stocks of large-, mid-, and small-capitalization companies in 44 countries.
“We believe that the new target benchmark offers a better representation of the international equity universe, offering exposure across the capitalization spectrum, including small-cap issues,” said Vanguard’s Chief Investment Officer Gus Sauter.
Vanguard also plans to introduce five new, low-cost share classes of the fund, including ETF Shares, to complement the existing Investor Shares.
Estimated Expense Ratio
* The expense ratio for Vanguard Total International Stock Index Fund was reported as 0.32% in the Fund’s prospectus dated February 26, 2010. For the six months ended April 30, 2010, the annualized expense ratio was 0.26%.
The new ETF Shares will offer an estimated expense ratio of 0.20%, which is expected to be the lowest expense ratio for an ETF based on the MSCI ACWI ex USA IMI Index (source: Morningstar, Inc.). Vanguard expects Vanguard Total International Stock ETF to begin trading in the first quarter of 2011.
Introduced in 1996, Vanguard Total International Stock Index Fund is Vanguard’s second largest international index fund with $26.2 billion in net assets. Vanguard offers nine international stock index funds that cover both broad markets and discrete regions.
Vanguard, headquartered in Valley Forge, Pennsylvania, is one of the world’s largest investment management companies and a leading provider of company-sponsored retirement plan services. Vanguard manages nearly $1.4 trillion in U.S. mutual fund assets. Vanguard offers more than 160 funds to U.S. investors and more than 50 additional funds in non-U.S. markets.
There are other material differences between funds that must be considered prior to investing.
All mutual funds and ETFs are subject to risk, which may result in the loss of principal. Prices of mid- and small-cap stocks often fluctuate more than those of large-company stocks. Foreign investing involves additional risks including currency fluctuations and political uncertainty. Stocks of companies in emerging markets are generally more risky than stocks of companies in developed countries.
Vanguard ETFs are not redeemable with an Applicant Fund other than in Creation Unit aggregations. Instead, investors must buy or sell Vanguard ETF Shares in the secondary market with the assistance of a stockbroker. In doing so, the investor will incur brokerage commissions and may pay more than net asset value when buying and receive less than net asset value when selling.
A registration statement relating to the Admiral, ETF, Signal, Institutional and Institutional Plus shares has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This communication shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, these securities in any state in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
Copies of the final Vanguard Total International Stock Index Fund prospectus for Admiral, ETF, Institutional, Institutional Plus, and Signal Shares, when available, as well as prospectuses for the Fund’s Investor shares and for all other Vanguard funds can be obtained by visiting www.vanguard.com, or by calling 800-662-7447. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing. Please note that a preliminary prospectus is subject to change.
U.S. Pat. No. 6,879,964 B2; 7,337,138.
Vanguard Marketing Corporation, Distributor.
All asset figures are as of August 31, 2010, unless otherwise noted.