Vanguard FTSE Emerging Markets ETF (NYSEARCA:VWO) becomes a competitive player


Dallas, Texas 03/06/2014 (FINANCIALSTRENDS) – Vanguard FTSE Emerging Markets ETF (NYSEARCA:VWO) it appears has become a market leader in the ERF business segment.  Apparently, as the ETF business becomes more complicated and competitive the domination of two of the players on the ETF circuit – Charles Schwab as well as Vanguard – comes to the forefront.

Vanguard FTSE Emerging Markets ETF (NYSEARCA: VWO) is one of the ETFs offered by the Vanguard group. Vanguard is known to hold low cost product market segment leadership. However, in the recent days, Schwab is looking to taken-on Vanguard by cutting down on the fees. This will hopefully lead to high fees-slashes and better deal for investors. This may happen sooner than later, as Vanguard too is offering lower fee charge packages.

Vanguard FTSE Emerging Markets ETF (NYSEARCA: VWO) which is part of the ‘mega’ ETF issuer that Vanguard has become. Recently the company reported fall in the expense ratios of over 5 of its international ETF stocks. The stocks which are to see the lower price bandwidth include- FTSE Emerging Markets (NYSEARCA: VWO).

The surprise part of the announcement was that the expense ratio was already considered to be low, following the previous fee cuts announced. This further cut in the expense ratio only indicates the pressure of competition.  In December of 2012, Vanguard had lowered its processing fees on over 12 ETFs and more it held at that time.

Vanguard FTSE Emerging Markets ETF(NYSEARCA:VWO) is considered to be the most popular of the funds held by Vanguard in this segment. The nearest competitor in this segment is Core MSCI Emerging Markets ETF:EMG. The fees this ETF bags is 18bps and is issued by competitor Schwab at 15 bps per year.

Vanguard FTSE Emerging Markets ETF(NYSEARCA:VWO) will now have a 15bps fee charge, piping Core MSCI offer and matching Schwab’s SCHE.