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ETF Specialist

A Closer Look at Vanguard's Active Factor ETFs

These factor strategies aren't groundbreaking, but they offer some incremental advantages over their peers.

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A version of this article was published in February 2018.

In February 2018, Vanguard launched a suite of promising, actively managed factor exchange-traded funds. These factor ETFs are not active in the traditional sense. They are systematic, rules-based strategies, so there are no qualitative judgments about the investment merit of each stock. But the managers have discretion to rebalance the portfolios (or not) when they see fit, which should help reduce implementation costs. 

Alex Bryan has a position in the following securities mentioned above: USMV, VFMF. Find out about Morningstar’s editorial policies.