Vanguard Global Credit Bond Fund

Overview

In the fast-changing world of global bond markets, investors have access to the broad capabilities and tight risk controls harnessed by the Global Credit Bond Fund, all at Vanguard’s characteristic low cost.

Bottom-up approach

A bottom-up approach, focused on security selection and relative value opportunities

Global team

A specialised, global team of 60+ credit research analysts

Outperformance

Designed for outperformance – without relying on overall market direction

Why security selection matters in global credit

Global credit can offer investors a number of key features, including a combination of income, diversification, strong risk-adjusted returns and liquidity. An active approach backed by the right process and level of expertise can help consistently deliver investors these qualities from the asset class.

Quarterly update webinars

What is the Global Credit Bond Fund?

The Global Credit Bond Fund aims to provide investors with a consistent level of return and income, while mitigating downside risk. It does this by adopting a true-to-label approach that derives alpha from careful securities selection across diversified sources, without taking excessive top-down directional risk.

As the manager of the Global Credit Bond Fund, Vanguard’s Fixed Income Group leverages the capabilities of portfolio managers, traders, credit analysts and quantitative strategists across the globe, and the expertise that comes with a 40-year history in active fixed income.

The lead portfolio managers have a wide remit to invest wherever they see the best risk/reward potential with the emphasis being on cross-sector relative value, tactical opportunities and risk management. The result is a portfolio of more than 1,000 bonds issued by corporates and governments. These are largely high-quality, investment-grade bonds that should act as a diversifier to equities through varying market cycles.

“Vanguard’s Fixed Income Group has the research resources, market relationships and quantitative tools needed to generate long-term, consistent levels of alpha from the vast opportunity set available in global credit.”

Sarang Kulkarni

Lead Portfolio Manager, Vanguard Global Credit Bond Fund.

Why the Global Credit Bond Fund?

Diversification

Focused on high-quality, investment-grade bonds that can act as a long-term diversifier to equities through varying market conditions.

Consistency

Our heritage in active fund management dates back to the year we were founded – 1975. For almost half a century we have strived to provide consistent returns while limiting downside risk.

Research-led

A disciplined, research-driven and tightly risk-controlled approach which aims to generate long-term, consistent levels of outperformance.

Expertise

The fund harnesses the wide-ranging expertise of a global credit research team of 60+ members with an average of 15 years’ experience*.

Investor value

Our scale helps us to provide value to investors with an ongoing charge of 0.35% versus an industry peer group average of 0.62%.**

Full focus

Our teams are solely focused on our mutual fund range – not stretched across multiple investment vehicles or mandates.

* Source: Vanguard. Data as at 31 March 2023

** Source: Vanguard. Data as at 31 March 2023. Peer group average OCF for IA Sector = Global Corporate Bond – USD Hedged. The ongoing charges figure (OCF) refers to the Investor GBP hedged Acc share class. The OCF covers the fund manager’s costs of managing the fund. It does not include dealing costs or additional costs such as audit fees.

#

Find out more about Vanguard’s approach to active management

Vanguard is one of the world’s largest active managers. Our heritage in active fund management dates back to the year we were founded – 1975. For almost half a century we have strived to provide long-term alpha at a cost that represents value to investors.

#

Investment risk information

The value of investments, and the income from them, may fall or rise and investors may get back less than they invested.

Some funds invest in emerging markets which can be more volatile than more established markets. As a result the value of your investment may rise or fall.

Investments in smaller companies may be more volatile than investments in well-established blue chip companies.

Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.

Funds investing in fixed interest securities carry the risk of default on repayment and erosion of the capital value of your investment and the level of income may fluctuate. Movements in interest rates are likely to affect the capital value of fixed interest securities. Corporate bonds may provide higher yields but as such may carry greater credit risk increasing the risk of default on repayment and erosion of the capital value of your investment. The level of income may fluctuate and movements in interest rates are likely to affect the capital value of bonds.

The Vanguard Global Credit Bond Fund may use derivatives, including for investment purposes, in order to reduce risk or cost and/or generate extra income or growth. For all other funds they will be used to reduce risk or cost and/or generate extra income or growth. The use of derivatives could increase or reduce exposure to underlying assets and result in greater fluctuations of the Funds net asset value. A derivative is a financial contract whose value is based on the value of a financial asset (such as a share, bond, or currency) or a market index.

Some funds invest in securities which are denominated in different currencies. Movements in currency exchange rates can affect the return of investments.

For further information on risks please see the “Risk Factors” section of the prospectus on our website.

Important information

This document is directed at professional investors and should not be distributed to, or relied upon by retail investors.

For further information on the fund's investment policies and risks, please refer to the prospectus of the UCITS and to the KIID before making any final investment decisions. The KIID for this fund is available, alongside the prospectus via Vanguard’s website.

This document is designed for use by, and is directed only at persons resident in the UK.

The information contained in this document is not to be regarded as an offer to buy or sell or the solicitation of any offer to buy or sell securities in any jurisdiction where such an offer or solicitation is against the law, or to anyone to whom it is unlawful to make such an offer or solicitation, or if the person making the offer or solicitation is not qualified to do so. The information in this document is general in nature and does not constitute legal, tax, or investment advice. Potential investors are urged to consult their professional advisers on the implications of making an investment in, holding or disposing of shares and /or units of, and the receipt of distribution from any investment.

The information contained in this document is for educational purposes only and is not a recommendation or solicitation to buy or sell investments.

Vanguard Investment Series plc has been authorised by the Central Bank of Ireland as a UCITS and has been registered for public distribution in certain EEA countries and the UK. Prospective investors are referred to the Funds' prospectus for further information. Prospective investors are also urged to consult their own professional advisers on the implications of making an investment in, and holding or disposing shares of the Funds and the receipt of distributions with respect to such shares under the law of the countries in which they are liable to taxation.

The Manager of Vanguard Investment Series plc is Vanguard Group (Ireland) Limited. Vanguard Asset Management, Limited is a distributor of Vanguard Investment Series plc.

The Manager of the Ireland domiciled funds may determine to terminate any arrangements made for marketing the shares in one or more jurisdictions in accordance with the  UCITS Directive, as may be amended from time-to-time.

For investors in Ireland domiciled funds, a summary of investor rights can be obtained here and is available in English, German, French, Spanish, Dutch and Italian.