TORONTO, June 1, 2021 /CNW/ - Vanguard Investments Canada
Inc. today announced plans to change the index tracked by two of
its Canadian ETFs on or about September 17,
2021.
Vanguard U.S. Dividend Appreciation Index ETF (TSX ticker
symbol: VGG) will change its index to the S&P U.S. Dividend
Growers Index from the NASDAQ US Dividend Achievers Select
Index.
Vanguard U.S. Dividend Appreciation Index ETF (CAD-hedged) (TSX
ticker symbol: VGH) will change its index to the S&P U.S.
Dividend Growers Index (CAD-hedged) from the NASDAQ US Dividend
Achievers Select Index (CAD-hedged).
The change to each index aligns with the investment objectives
and strategies of the ETFs and the ETFs will, following the change,
provide unitholders with substantially the same exposure to the
asset class to which the ETFs were exposed prior to the
change. These ETFs offer exposure to U.S. common stocks of
companies with a track record of increasing their dividends over
time.
These changes reflect an ongoing due diligence process to give
Vanguard's Canadian investors the
best chance for investment success. Based on our continual
analysis, Vanguard believes
S&P's approach to dividend investing in these new indices will
provide additional benefits to unitholders in the form of greater
transparency as well as provide the following new features:
- Free-float adjustments to ensure each index will
count only shares that are available to investors. The indices
will exclude closely held shares, such as those held by members of
a company founder's family.
- A three-day rebalance window to help manage
transaction costs and minimize tracking error. The periodic
changes to add, remove, or rebalance the constituent securities in
each index will take place over three days instead of one day.
- Buffered yield screens intended to minimize excessive
turnover. At each annual rebalance, all dividend-paying stocks
in the investible universe are ranked in order of dividend yield
with the highest-yielding at the top. A stock will not be eligible
for first-time admission to the index if its dividend yield is in
the top 25%. During subsequent rebalances, any stock already in the
index may remain unless its yield is in the top 15%.
Vanguard's approach to index
selection
Based on deep indexing experience and expertise, Vanguard believes investors benefit from
indices that are objective, transparent, investable, and
representative of the risk and return characteristics of the target
market. As such, the firm has developed and adheres to a
multi-dimensional process to evaluate and select indices for funds
and ETFs.
The suitability of each fund's index is based on index
construction methodology, market coverage, classification criteria,
rebalancing schedule, cost, and other standards. Vanguard also regularly assesses index
providers to ensure their data integrity processes and risk
management practices support their ability to provide the timely,
accurate, and high-quality data required to develop and administer
indices on an ongoing basis. The firm places a high value on the
objectivity, credibility, and independence offered by index
providers.
About Vanguard
Canadians own CAD $60 billion in
Vanguard assets, including
Canadian and U.S.-domiciled ETFs and Canadian mutual funds.
Vanguard Investments Canada Inc. manages CAD $38 billion in assets (as of April 30, 2021) with 37 Canadian ETFs and four
mutual funds currently available. The Vanguard Group, Inc. is one
of the world's largest investment management companies and a
leading provider of company-sponsored retirement plan services.
Vanguard manages USD $7.8 trillion (CAD $9.5
trillion) in global assets, including over USD $1.9 trillion (CAD $2.3
trillion) in global ETF assets (as of April 30, 2021). Vanguard has offices in the United States, Canada, Mexico, Europe and Australia. The firm offers 439 funds,
including ETFs, to its more than 30 million investors
worldwide.
Vanguard operates under a
unique operating structure. Unlike firms that are publicly held or
owned by a small group of individuals, The Vanguard Group, Inc. is
owned by Vanguard's U.S.-domiciled
funds and ETFs. Those funds, in turn, are owned by Vanguard clients. This unique mutual structure
aligns Vanguard interests with
those of its investors and drives the culture, philosophy, and
policies throughout the Vanguard
organization worldwide. As a result, Canadian investors benefit
from Vanguard's stability and
experience, low-cost investing, and client focus. For more
information, please visit vanguardcanada.ca.
Important information
Commissions, management fees, and expenses all may be
associated with investment funds. Investment objectives, risks,
fees, expenses, and other important information are contained in
the prospectus; please read it before investing. Investment funds
are not guaranteed, their values change frequently, and past
performance may not be repeated. Vanguard funds are managed by Vanguard
Investments Canada Inc. and are available across Canada through registered dealers.
The S&P U.S. Dividend Growers Index is a product of S&P
Dow Jones Indices LLC ("S&P DJI"), a division of S&P Global
("S&P"), or its affiliates, and have been licensed for use by
Vanguard. S&P® is a registered
trademark of Standard & Poor's Financial Services LLC, a
division of S&P; Dow Jones® is a registered trademark of Dow
Jones Trademark Holdings LLC ("Dow Jones"); and these trademarks
have been licensed for use by S&P DJI and sublicensed for
certain purposes by Vanguard.
Vanguard U.S. Dividend Appreciation Index ETF and Vanguard U.S.
Dividend Appreciation Index ETF (CAD-hedged) are not sponsored,
endorsed, sold, or promoted by S&P DJI, Dow Jones, S&P, or
their respective affiliates, and none of such parties make any
representation regarding the advisability of investing in such
product(s), nor do they have any liability for any errors,
omissions, or interruptions of the S&P U.S. Dividend Growers
Index.
"Dividend Achievers" is a trademark of The NASDAQ OMX Group,
Inc. (collectively, with its affiliates, "NASDAQ OMX") and has been
licensed for use by The Vanguard Group, Inc. Vanguard ETFs are not
sponsored, endorsed, sold, or promoted by NASDAQ OMX and NASDAQ OMX
makes no representation regarding the advisability of investing in
the ETFs. NASDAQ OMX MAKES NO WARRANTIES AND BEARS NO LIABILITY
WITH RESPECT TO THE VANGUARD
ETFs.
SOURCE Vanguard Investments Canada Inc.