Vanguard Announces First Index Global Fund

The Vanguard Group launched a fund that seeks to track the investment performance of the FTSE All-World Index, a benchmark of approximately 2,900 stocks in 47 countries.

A Vanguard release about the new Vanguard Total World Stock Index Fund said its institutional share classes assess a 0.25% purchase fee to help defray the transaction costs associated with buying foreign securities and a 2% redemption fee on shares sold within two months of purchase.

The fund’s share classes include ETF shares (ticker: VT) featuring an estimated expense ratio of 0.25%, as well as institutional shares (ticker: VTWIX), which have the lower estimated expense ratio at 0.20%. A $5 million minimum initial investment is required.

The FTSE All-World Index is a market-capitalization-weighted index designed to measure the performance of large- and mid-capitalization stocks worldwide. Stocks of companies domiciled in developed and emerging international markets represent approximately 59% of the index; the remaining 41% are U.S. stocks, according to the release.

“Vanguard Total World Stock Index Fund is our first passively managed global fund and provides exposure to the world’s stock markets through a single, low-cost vehicle,” said Vanguard Chief Investment Officer Gus Sauter, in the release. “We view the new offering as an ideal “foundation fund’ for a well-diversified investment portfolio.”