NEW YORK--(BUSINESS WIRE)--VanEck announced today that it is lowering the expense ratio on two ETFs: VanEck Vectors J.P. Morgan EM Local Currency Bond ETF (NYSE Arca: EMLC) and VanEck Vectors Emerging Markets Aggregate Bond ETF (NYSE Arca: EMAG). Effective June 8, 2018, the expense cap for EMLC will be reduced from 0.42% to 0.30%1, and the expense cap for EMAG will be reduced from 0.49% to 0.35%2.
EMLC is the largest and most liquid U.S. listed ETF providing access to emerging markets local currency bonds. It seeks to track the J.P. Morgan GBI-EMG Core Index (GBIEMCOR), which is comprised of bonds issued by emerging markets governments and denominated in the local currency of the issuer.
EMAG is the only U.S. listed ETF that provides comprehensive exposure to the full emerging markets debt opportunity set. It seeks to track the MVIS® EM Aggregate Bond Index (MVEMAG), which is comprised of emerging market sovereign bonds and corporate bonds denominated in U.S. dollars, euros, or local emerging markets currencies, and includes both investment grade and below investment grade rated securities.
VanEck regularly evaluates fund expenses to identify opportunities to lower shareholder costs. VanEck has over 20 years of experience managing emerging markets debt strategies, and offers a broad suite of both actively managed and passive solutions that provide access to the asset class. These latest fee reductions allow investors to benefit from the potential opportunities emerging markets debt provides within a portfolio, at a lower cost.
“Emerging markets debt has evolved into an important asset class over the past several decades, and we believe it warrants a strategic allocation within investors’ portfolios. It is a diverse asset class offering multiple opportunities, and offers the potential to provide significant diversification benefits,” said Fran Rodilosso, Head of Fixed Income ETF Portfolio Management.
In addition to EMLC and EMAG, VanEck also manages VanEck Vectors® Emerging Markets High Yield Bond ETF (NYSE Arca: HYEM®), VanEck Vectors® EM Investment Grade + BB Rated USD Sovereign Bond ETF (NYSE Arca: IGEM®), and VanEck Vectors® ChinaAMC China Bond ETF (NYSE Arca: CBON®), among other funds. Investors can subscribe to receive commentaries and other emerging markets debt insights from VanEck by visiting the firm’s website.
VanEck has a history of looking beyond the financial markets to identify trends that are likely to create impactful investment opportunities. We were one of the first U.S. asset managers to offer investors access to international markets. This set the tone for the firm’s drive to identify asset classes and trends – including gold investing in 1968, emerging markets in 1993, and exchange traded funds in 2006 – that subsequently shaped the investment management industry.
Today, VanEck offers active and passive strategies with compelling exposures supported by well-designed investment processes. As of April 30, 2018, VanEck managed approximately $46 billion in assets, including mutual funds, ETFs, and institutional accounts. The firm’s capabilities range from core investment opportunities to more specialized exposures to enhance portfolio diversification. Our actively managed strategies are fueled by in-depth, bottom-up research and security selection from portfolio managers with direct experience in the sectors and regions in which they invest. Investability, liquidity, diversity, and transparency are key to the experienced decision-making around market and index selection underlying VanEck’s passive strategies.
Since our founding in 1955, putting our clients’ interests first, in all market environments, has been at the heart of the firm’s mission.
1 EMLC’s gross expense ratio is 0.40% and net expense ratio is 0.30%. Expenses are capped contractually at 0.30% until at least 9/1/19. This cap excludes certain expenses, such as acquired fund fees and expenses, interest, trading, taxes and extraordinary expenses.
2 EMAG’s gross expense ratio is 1.26% and net expense ratio is 0.35%. Expenses are capped contractually at 0.35% until at least 9/1/19. This cap excludes certain expenses, such as acquired fund fees and expenses, interest, trading, taxes and extraordinary expenses.
VanEck Vectors J.P. Morgan EM Local Currency Bond ETF (EMLC) is not sponsored, endorsed, sold or promoted by J.P. Morgan and J.P. Morgan makes no representation regarding the advisability of investing in EMLC. J.P. Morgan does not warrant the completeness or accuracy of the J.P. Morgan GBI-EMG Core Index. "J.P. Morgan" is a registered service mark of JPMorgan Chase & Co. © 2018. JPMorgan Chase & Co. All rights reserved.
MVIS® EM Aggregate Bond Index is the exclusive property of MV Index Solutions GmbH (a wholly owned subsidiary of VanEck Associates Corporation), which has contracted with Solactive AG to maintain and calculate the Index. Solactive AG uses its best efforts to ensure that the Index is calculated correctly. Irrespective of its obligations towards MV Index Solutions GmbH, Solactive AG has no obligation to point out errors in the Index to third parties. The VanEck Vectors Emerging Markets Aggregate Bond ETF is not sponsored, endorsed, sold or promoted by MV Index Solutions GmbH and MV Index Solutions GmbH makes no representation regarding the advisability of investing in the Fund.
Fund shares are not individually redeemable and will be issued and redeemed at their net asset value (NAV) only through certain authorized broker-dealers in large, specified blocks of shares called “creation units” and otherwise can be bought and sold only through exchange trading. Shares may trade at a premium or discount to their NAV in the secondary market.
An investment in the Funds may be subject to risks which include, among others, credit risk, call risk, interest rate risk, and sovereign defaults, all of which may adversely affect the Funds. High yield bonds may be subject to greater risk of loss of income and principal and are likely to be more sensitive to adverse economic changes than higher rated securities. International investing involves additional risks which include greater market volatility, the availability of less reliable financial information, higher transactional and custody costs, taxation by foreign governments, decreased market liquidity and political instability. Changes in currency exchange rates may negatively impact the Funds’ return. Investments in emerging markets securities are subject to elevated risks which include, among others, expropriation, confiscatory taxation, issues with repatriation of investment income, limitations of foreign ownership, political instability, armed conflict and social instability. The Funds’ assets may be concentrated in a particular sector and may be subject to more risk than investments in a diverse group of sectors.
Investing involves substantial risk and high volatility, including possible loss of principal. Bonds and bond funds will generally decrease in value as interest rates rise. An investor should consider the investment objective, risks, charges and expenses of a Fund carefully before investing. To obtain a prospectus and summary prospectus, which contain this and other information, call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.
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