RIABiz

News, Vision & Voice for the Advisory Community

RIABiz

There were so many good reasons for Vanguard to fold its first ETF but radical underperformance may stand out for the 'illiquidity' fund

The Malvern, Pa., manager blamed $44-million fund's scale, but marked underperformance and a manager departure as likely doomed it, one Vanguard watcher says

Admin:
no description available
Dan Reyes: 'Despite the ETF’s capable advisor and sound approach to factor investing, it has not gained scale since its 2018 debut.'

Related Moves

Dimensional Fund Advisors, long the flagship of factor investing, struggles to chart a course as a nimble rival and big foot competitors cut into its market--and exploit its slow move to ETFs

Vanguard, BlackRock and Avantis rattle a complacent Dimensional Fund Advisors with fee cuts and ETF roll outs based on 'smart beta.'

August 9, 2022 at 1:57 AM

Avantis Investors rakes in another top-tier PIMCO talent who can do a very un-asset managerial task --talk to RIAs directly

Ex-DFA co-CEO Eduardo Repetto gets Hozef Arif to fill another key seat at the 60-person suite in Little Tokyo (LA) after he checks all the boxes

July 25, 2020 at 1:20 AM

RIA recap: Bernie Clark promises to 'be there' for coming TDA-Schwab system snafus; Fidelity gets custody win; Vanguard dishes out big tax bill to investors

Schwab RIA chief petitions for 'patience' for coming merger inconveniences but 'repapering' is no culprit; Carrie Pomerantz gets Schwab board seat; Addepar wins $65 billion AUM contract.

November 3, 2022 at 1:59 AM

Vanguard Group shows up as 'alpha' disciple with two new fixed-income fund launches as it surpasses PIMCO's $2 trillion with ex-Goldman Sachs partner now calling the shots

The $8 trillion Malvern, Pa. manager owns beta investing, but RIAs are demanding higher income -- hence market timing and cherry picking -- from their fixed-income allocation.

August 10, 2021 at 11:46 PM

See more related moves


Brian Murphy

Brian Murphy

September 27, 2022 — 4:48 AM
To me this is a case of not giving the fund enough time to reach its potential, performance-wise. Here's why: over the last 3-5 years, investors have focused on the most liquid names in the U.S. investment landscape...names like Apple, Netflix, Microsoft, etc., (essentially the big kahunas in the S&P 500) to the detriment of the rest of the market (and the holdings of this fund in particular). Comparing the U.S. Liquidity Factor ETF to the performance of the VTI is flawed from that perspective in that their investment universes are almost diametrically opposed! My guess is that one would need to runway of at least a full market cycle (typically 6-15 years) in order to prove out a thesis of there being "alpha" in illiquid names. But most advisors and investors don't have the stomach for such time tables. Unfortunate, but that's the way the cookie crumbles.

RIABiz Directory

The Industry Sourcebook for RIAs

   |    LISTING


RIABiz Directory sponsored by:

Directory Sponsor Logo