Vanguard this week said that it has negotiated lower cost index-licensing deals that will result in 22 of its index mutual funds switching to new benchmarks, and adjusting the stocks they invest in accordingly.
The changes are expected to eventually lead to fee reductions for investors in Vanguard funds holding $537 billion, or more than a quarter of the $1.95 trillion that the company manages in U.S. mutual funds and exchange-traded funds.
The benchmark changes affect all share classes for the 22 funds, including shares available to average investors, as well as those geared toward institutional investors, such as companies offering 401(k) plans. Also affected are Vanguard's ETF share classes of each fund.
Below are details on which funds will switch in coming months to new indexes from their current benchmarks licensed by the firm MSCI. The new indexes for the domestic funds listed below are licensed from the University of Chicago's Center for Research in Security Prices, or CRSP, while the international funds will track indexes licensed from the firm FTSE.
|Domestic fund names||Current MSCI benchmark||New CRSP benchmark|
|Vanguard Total Stock Market Index||MSCI US Broad Market Index||CRSP US Total Market Index|
|Vanguard Institutional Total Stock Market Index||MSCI US Broad Market Index||CRSP US Total Market Index|
|Vanguard Balanced Index||Stock-bond balanced index, including MSCI US Broad Market Index||Stock-bond balanced index, including CRSP US Total Market Index|
|Vanguard Mega Cap 300 Index||MSCI US Large Cap 300 Index||CRSP US Mega Cap Index|
|Vanguard Mega Cap 300 Growth Index||MSCI US Large Cap Growth Index||CRSP US Mega Cap Growth Index|
|Vanguard Mega Cap 300 Value Index||MSCI US Large Cap Value Index||CRSP US Mega Cap Value Index|
|Vanguard Large-Cap Index||MSCI US Prime Market 750 Index||CRSP US Large Cap Index|
|Vanguard Growth Index||MSCI US Prime Market Growth Index||CRSP US Large Cap Growth Index|
|Vanguard Value Index||MSCI US Prime Market Value Index||CRSP US Large Cap Value Index|
|Vanguard Mid-Cap Index||MSCI US Mid Cap 450 Index||CRSP US Mid Cap Index|
|Vanguard Mid-Cap Growth Index||MSCI US Mid Cap Growth Index||CRSP US Mid Cap Growth Index|
|Vanguard Mid-Cap Value Index||MSCI US Mid Cap Value Index||CRSP US Mid Cap Value Index|
|Vanguard Small-Cap Index||MSCI US Small Cap 1750 Index||CRSP US Small Cap Index|
|Vanguard Small-Cap Growth Index||MSCI US Small Cap Growth Index||CRSP US Small Cap Growth Index|
|Vanguard Small-Cap Value Index||MSCI US Small Cap Value Index||CRSP US Small Cap Value Index|
|VVIF Mid-Cap Index Portfolio||MSCI US Mid Cap 450 Index||CRSP US Mid Cap Index|
|International stock fund names||Current MSCI benchmark||New FTSE benchmark|
|Vanguard European Stock Index||MSCI Europe Index||FTSE Developed Europe Index|
|Vanguard Pacific Stock Index||MSCI Pacific Index||FTSE Developed Asia Pacific Index|
|Vanguard Emerging Markets Stock Index||MSCI Emerging Markets Index||FTSE Emerging Index|
|Vanguard Total International Stock Index||MSCI ACWI ex USA IMI Index||FTSE Global All Cap ex US Index|
|Vanguard Developed Markets Index||MSCI EAFE Index||FTSE Developed ex North America Index|
|Vanguard Tax-Managed International||MSCI EAFE Index||FTSE Developed ex North America Index|