The world’s largest index manager Vanguard has launched a low cost income focused active fund in Australia.
The new fund is called the Vanguard Managed Payout Fund and is available as currently available as a wholesale fund option only. The new fund seeks to firstly provide a consistent monthly cash distributions over a year, and secondly provide a total return that keeps pace with inflation over the longer term.
The fund’s exposure will be to a diversified portfolio of assets including Australian and international shares, REITs, bonds, cash and other assets. The fund’s benchmark is an internal composite benchmark made up of the following:
- 25% S&P/ASX 300 Index
- 30% MSCI World ex-Australia Index (AUD)
- 2% S&P/ASX 300 A-REIT Index
- 3% FTSE EPRA/NAREIT Developed ex-Australia Rental Index (AUD hedged)
- 25% Bloomberg Barclays Global Treasury Index (AUD hedged)
- 10% Bloomberg AusBond Composite 0+ Yr Index
- 5% Bloomberg Commodity Index (hedged to AUD).
In terms of fees, the headline ongoing management fee for this fund is 0.55% p.a., which reflects the active management component in this fund.