UPDATE 11/14: After I published this article, Vanguard confirmed that the prospectuses they filed on November 13 were incorrect. The new Wellington-run ETFs will not be charging 0.13%–0.17% in expenses. No, the actual expense ratios will fall between 0.30% and 0.40%, as Vanguard initially guided.
Those fees are still competitive—just not industry-shaking.
I've left the story below as originally published. You can see a follow-up note about the expense ratios here.
Yesterday, Vanguard updated its SEC filings to launch its first actively managed ETFs, run by human stock pickers—not algorithms. The three new funds (listed below) should begin trading any day now. (A few days' lag between this updated filing and live trading is typical.)
- Vanguard Wellington Dividend Growth Active ETF (VDIG)
- Vanguard Wellington U.S. Growth Active ETF (VUSG)
- Vanguard Wellington U.S. Value Active ETF (VUSV)
Let’s get one thing straight: These are new funds.
Yes, two share (almost) identical names with existing mutual funds, but they are not new share classes—they’re separate legal entities. That clean structure matters—no embedded gains, likely better tax treatment and no relief in sight for mutual fund investors hoping to dodge capital gains distributions.
Here’s what you—as an investor—should know before deciding whether any of them belong in your portfolio. (This is a true “Quick Take,” I’ll take a closer look at the ETFs—particularly the growth and value funds—next week.)
A Fee Cut?
One detail in the updated prospectus jumped off the page: the fees. They’re dramatically lower than anything I expected.