Vanguard's bond ETF discount exceeds 6%

Fixed income disruptions

James Baxter-Derrington
clock • 1 min read

Vanguard has seen its total market bond ETF (BND) suffer from the recent volatility, with its 12 March closing price trading on a 6.2% discount to NAV. As noted, fixed income market disruptions in the week beginning 9 March caused greater disparity than is typical between the price of bond ETFs and the value of their constituent bonds, leading to this discount. Fixed income ETFs tend to trade at a premium, rather than discount, to NAV, with BND's average closing premium totalling 0.17% since its launch in 2007. Rich Powers, head of ETF product management at Vanguard, noted that dis...

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