Index investing giant Vanguard has added to its range of actively managed products with the launch of a global credit fund that it claims to be the cheapest in the UK. 
The Vanguard Global Credit Bond fund will carry an ongoing charges figure (OCF) of just 0.35 per cent for investor share classes and 0.30 per cent for institutional share classes.
The firm said this OCF is lower than the charges on all active retail funds offered in the global credit bond category in the UK.
Vanguard Global Credit Bond will invest in a broadly diversified portfolio of global credit bonds including high quality bonds from corporate issuers, government agencies and supranational organisations from around the world.
It will be managed with a team-based approach by Vanguard's global fixed income group, which runs total assets under management of $1.2trn.
Paul Malloy, head of fixed income for Vanguard in Europe, said: “The case for investing in high quality, liquid global credit bonds is compelling as it can offer a reasonable income compared with other bond and equity income strategies.
“Another important element is the universe the fund will invest in will typically have lower volatility than high yield bonds or equities, helping to offset a portfolio’s return volatility. Investors should also pay close attention to costs, as the impact of fees is amplified in a low-yield market environment.”
Vanguard Global Credit Bond is the fifth actively managed fund that Vanguard has launched in the UK. It follows the launch of four funds in 2016: Vanguard Global Equity, Vanguard Global Equity Income, Vanguard Global Emerging Markets and Vanguard Global Balanced.