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Vanguard Australian Government Bond Index Fund

About this Fund

Fund Detail

PDS https://informedinvestor.com.au/view/pds/101047-2023-10-31-03:32.pdf
FUND MANAGER Vanguard Investments Australia
ASX Code
APIR VAN0025AU
ASSET CLASS EXCHANGE TRADED FUNDS
INVESTMENT STYLE The Fund invests in high-quality, income-generating securities issued by the Commonwealth Government of Australia, Australian State Government authorities and treasury corporations.
INVESTMENT PROFILE The Fund seeks to track the return of the Benchmark before taking into account fees, expenses, and tax.
CURRENCY MANAGEMENT Unhedged
INCEPTION DATE 22-12-2008
BENCHMARK Bloomberg AusBond Government 0+ Yr Index
FUND SIZE Bloomberg AusBond Government 0+ Yr Index
DISTRIBUTION FREQUENCY Quarterly
NO. OF HOLDINGS 100-150
FEES 0.24% p.a.
STRUCTURE

Benefits

Benefits

Benefits of investing in the Vanguard Australian Government Bond Index Fund

The significant features and benefits of investing in the Fund include:

  • Competitive long-term performance - Vanguard's investment approach provides investors with an efficient way to capture long-term market performance.
  • Diversification - The Fund provides exposure to a diversified portfolio of securities, which means the Fund is less exposed to the performance fluctuations of individual securities. This moderates the volatility of the portfolio and smooths out' investment returns over time. The Fund provides exposure to a wide selection of available securities in the relevant index, generally holding significantly more securities than most active funds with the same benchmark. From time to time, however, the number of securities in a given index may reduce due to factors such as index rebalancing.
  • Low cost investing - The Fund has low ongoing fees as we strive to minimise the costs of managing and operating the Fund. The Fund typically has low portfolio turnover resulting in low trading costs such as brokerage and other transaction costs.

The significant features and benefits of investing with Vanguard include:

  • Stability and experience - The Vanguard Group, Inc. established the world's first index mutual fund for individual investors in 1976 and has been a leader in low cost index investing ever since. In Australia, Vanguard leverages the scale, experience and resources of our established global business. Investing in the Fund allows you to access the knowledge and skill of Vanguard as a specialist investment manager.
  • Client focus - The Vanguard Group, Inc. was founded on a simple but revolutionary idea - that an investment company should manage the funds it offers in the sole interest of its clients. From rigorous risk management to transparent pricing to plain talk communications, we put our clients' interest first.
  • Low costs - Investors can't control the markets, but they can control the costs of investing. Providing low cost investments isn't a pricing strategy for us. It's how we do business. Vanguard's scale also helps to keep costs low.

Risk level

Low

Investor suitability

Investors with a medium term investment horizon, seeking a steady and reliable income stream.

RISK LEVEL Low: The potential for relatively stable returns, with a low potential for loss of capital
INVESTOR SUITABILITY

Investors with a medium term investment horizon, seeking a steady and reliable income stream.

Risks

Title
Detail

Key Features

About the Fund

The Fund invests in high-quality, income-generating securities issued by the Commonwealth Government of Australia, Australian State Government authorities and treasury corporations.  While being low cost, the Fund also provides some protection against capital volatility. The investments in the Fund are predominantly rated AA or higher by Standard & Poor's ratings agency or equivalent.

Investment objective

Vanguard Australian Government Bond Index Fund seeks to track the return of the Bloomberg AusBond Govt 0+ Yr Index before taking into account fees, expenses and tax.

Mandate

How we invest your money

The Fund seeks to track the return of the Bloomberg AusBond Government 0+ Yr Index before taking into account fees, expenses, and tax.

The Bloomberg AusBond Government 0+ Yr Index is a market value-weighted index of securities (bonds) issued by the Commonwealth Government of Australia and Australian State Government financing authorities and treasury corporations.

The Fund aims to hold all of the securities in the index, where practical, or otherwise a representative sample of the securities included in the index. Vanguard selects the securities it holds based on liquidity, access to markets, portfolio cash-flow and minimum trade quantities with the aim of tracking the return of the index. Security weightings in the Fund may vary from the index weightings. The Fund may exclude certain securities that are included in the index or may invest in securities that have been or are expected to be included in the index.

The Fund may utilise derivative instruments including futures traded on a licensed exchange and over the counter derivative financial instruments. Derivative instruments are used to manage the overall interest rate and credit risk exposure of the Fund where it is either unable to invest directly in physical securities or is in the Fund's best interest to do so. Derivative financial instruments will not be used to leverage the assets of the Fund.

In accordance with the index methodology, at the time of purchase the eligible fixed income securities in the Fund must be of an investment grade credit quality, which is determined by reference to ratings published by independent credit research firms.

Strategic asset allocation*

  • Australian fixed interest 100%

*This is a targeted strategic asset allocation. In addition, cash may be held for the purposes of liquidity management and derivatives may be used to manage market exposure.